PROVANT INC, S-1, 1998-02-12

PROVANT INC
S-1, 1998-02-12

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 12, 1998

REGISTRATION NO. 333-
================================================================================

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549
------------------------

FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------

PROVANT, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------

<TABLE>
<S> <C> <C>
DELAWARE 8742 04-3395167
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>

67 BATTERYMARCH STREET, SUITE 500
BOSTON, MA 02110
(617) 261-1600
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------

PAUL M. VERROCHI
PROVANT, INC.
67 BATTERYMARCH STREET, SUITE 500
BOSTON, MA 02110
(617) 261-1600
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------

COPIES OF COMMUNICATIONS TO:

<TABLE>
<S> <C>
CONSTANTINE ALEXANDER, ESQUIRE KEITH F. HIGGINS, ESQUIRE
JAMES E. DAWSON, ESQUIRE ROPES & GRAY
NUTTER MCCLENNEN & FISH, LLP ONE INTERNATIONAL PLACE
ONE INTERNATIONAL PLACE BOSTON, MA 02110
BOSTON, MA 02110 TELEPHONE: (617) 951-7000
TELEPHONE: (617) 439-2000 FACSIMILE: (617) 951-7050
FACSIMILE: (617) 973-9748
</TABLE>

------------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC:
As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act,
check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If the Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
=============================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
OFFERING PRICE AGGREGATE
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE PER OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED(1) SHARE(2) PRICE(2) REGISTRATION FEE
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------
Common Stock (par value $.01 per
share)............................. 2,990,000 $13.00 $38,870,000 $11,467
=============================================================================================================
</TABLE>

(1) Includes 390,000 shares that the Underwriters have the option to purchase to
cover over-allotments.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(a) under the Securities Act of 1933, as amended.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.

================================================================================
<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED FEBRUARY 12, 1998

2,600,000 SHARES

PROVANT, INC.

COMMON STOCK

All of the 2,600,000 shares of Common Stock offered hereby are being sold
by Provant, Inc.

Prior to this offering (the "Offering"), there has been no public market
for the Common Stock of the Company. It is currently estimated that the initial
public offering price of the Common Stock will be between $11.00 and $13.00 per
share. See "Underwriting" for a discussion of the factors to be considered in
determining the initial public offering price. Application will be made to list
the Common Stock on the New York Stock Exchange (the "NYSE") under the symbol
"POV."

SEE "RISK FACTORS" COMMENCING ON PAGE 9 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.

------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
================================================================================================
Price to Underwriting Proceeds to
Public Discount (1) Company (2)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share......................... $ $ $
Total (3)......................... $ $ $
================================================================================================
</TABLE>

(1) See "Underwriting" for information concerning indemnification of the
Underwriters and other matters.

(2) Before deducting expenses payable by the Company, estimated at $2,750,000.

(3) The Company has granted to the Underwriters a 30-day option to purchase up
to 390,000 additional shares of Common Stock solely to cover
over-allotments, if any. If the Underwriters exercise this option in full,
the Price to Public will total $ , the Underwriting Discount will
total $ and the Proceeds to Company will total $ . See
"Underwriting."

The shares of Common Stock are offered by the several Underwriters named
herein, subject to receipt and acceptance by them and subject to their right to
reject any order in whole or in part. It is expected that delivery of the
certificates representing such shares will be made against payment therefor at
the offices of NationsBanc Montgomery Securities LLC on or about
, 1998.

------------------------

NationsBanc Montgomery Securities LLC

Salomon Smith Barney
Piper Jaffray Inc.

, 1998
<PAGE> 3

[MAP/PHOTO]

CERTAIN PERSONS PARTICIPATING IN THE OFFERING MAY ENGAGE IN TRANSACTIONS THAT
STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK, INCLUDING
PURCHASES OF THE COMMON STOCK TO STABILIZE ITS MARKET PRICE, PURCHASES OF THE
COMMON STOCK TO COVER SOME OR ALL OF A SHORT POSITION IN THE COMMON STOCK
MAINTAINED BY THE UNDERWRITERS AND THE IMPOSITION OF PENALTY BIDS. FOR A
DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."

2
<PAGE> 4

PROSPECTUS SUMMARY

Simultaneous with and as a condition to the consummation of the Offering
made by this Prospectus, Provant, Inc. will acquire in separate combination
transactions (collectively, the "Combination") seven providers of training and
development services and products (each, a "Founding Company," and collectively,
the "Founding Companies"). See "Combination." Unless otherwise indicated, all
references to the "Company" herein mean Provant, Inc. and the Founding
Companies, and references to "Provant" mean Provant, Inc. and its wholly-owned
subsidiaries prior to the consummation of the Combination. Investors should
carefully consider the information set forth under the heading "Risk Factors."

The following summary is qualified in its entirety by, and should be read
in conjunction with, the more detailed information and financial statements and
related notes appearing elsewhere in this Prospectus. Unless otherwise
indicated, (i) all share, per share and financial information in this
Prospectus: (a) has been adjusted to give effect to the Combination (excluding
the issuance of up to 1,325,000 shares of Common Stock as Additional
Consideration (as defined herein) for six of the Founding Companies and the
payment in Common Stock and cash of the Star Contingent Consideration (as
defined herein) for the seventh Founding Company), (b) assumes an initial public
offering price of $12.00 per share, (c) gives effect to a stock dividend
(assumed to be 871.5263-for-1) that will be declared by Provant prior to the
consummation of the Offering and (d) assumes no exercise of the Underwriters'
over-allotment option; and (ii) unless otherwise noted, all references to fiscal
years mean the Company's or a Founding Company's fiscal year ending on June 30
in the same calendar year (e.g., "fiscal 1997" means the fiscal year ended June
30, 1997).

THE COMPANY

The Company provides a broad range of training and development services and
products to Fortune 1000 companies, other large and medium-sized corporations
and government entities. The Company's services and products are designed to
increase the productivity of organizations by improving employee selection,
recruitment and retention; enhancing employee work skills; developing employee
management and leadership skills; and facilitating organizational assessment,
direction and change. The Company offers both customized and "off-the-shelf"
services and products that are designed to provide measurable improvements in
employee performance and productivity. The Company delivers its services and
products through multiple delivery methods, including instructor-led classroom
training and seminars, certification of client employees as instructors
("train-the-trainer"), interactive multimedia software (such as CD-ROM) and
distance-based media (such as video conferencing, intranets and the Internet).
The seven Founding Companies are recognized leaders in their respective fields
and have developed a wide range of services and products, a substantial
knowledge base created from years of research and development, and a
well-established client base. The Company's objective is to become a leading
single source provider of high-quality training and development services and
products that are distributed through multiple delivery methods.

The Company provided training and development services and products to more
than 1,700 companies and 75 government entities in fiscal 1997, including Abbott
Laboratories, Bank of America, Conoco, Inc., Eli Lilly and Company, Federal
Express, Federated Department Stores, Inc., Hewlett-Packard Company, J.P. Morgan
& Co., Incorporated, Metropolitan Life Insurance Company, Mobil Corporation, the
Department of Defense, the Immigration and Naturalization Service and the
Internal Revenue Service. During this period, the Company generated revenues of
more than $100,000 from each of 75 different corporate clients and from over 15
different federal government entities. For fiscal 1997, the Company had pro
forma revenue of $68.8 million and pro forma income from operations of $8.0
million. From fiscal 1995 through fiscal 1997, the combined revenue of the
Founding Companies grew at a compound annual rate of 21.8%.

3
<PAGE> 5

growth rate of approximately 5.8%. The portion of the market devoted to external
training is increasing, as corporations and government agencies focus on their
core competencies, shift fixed training costs to variable costs, and obtain
training and development services, products, technology and expertise that may
not be available internally. The Company believes that corporations and
government entities seek external providers that can meet their overall training
and development needs by: (i) providing a broad range of high-quality services
and products in both customized and off-the-shelf formats; (ii) delivering
training through multiple delivery methods capable of reaching large and
geographically dispersed work forces; and (iii) utilizing the most current
technology available.

The Company intends to capitalize on these industry trends and enhance its
position as a leading provider of training and development services and products
by pursuing a multi-faceted growth strategy. The Company intends to seek
internal growth by: (i) capitalizing on cross-selling opportunities among the
Founding Companies; (ii) implementing an aggressive sales and marketing
strategy; (iii) expanding its service and product offerings; and (iv) leveraging
investments in technology and deploying leading technologies. In addition, the
Company intends to pursue strategic acquisitions of providers of training and
development services and products in order to expand its service and product
offerings, delivery methods and client base. The Company believes that its
senior management team, particularly Paul M. Verrochi, its Chairman and Chief
Executive Officer and co-founder and former Chairman of American Medical
Response, Inc., and John H. Zenger, its President and former Chairman of Times
Mirror Training Group, the nation's largest group of training companies, will
provide the Company with a competitive advantage in implementing its growth
strategy.

Provant is a Delaware corporation. Its principal executive offices are
located at 67 Batterymarch Street, Suite 500, Boston, Massachusetts 02110. Its
telephone number is (617) 261-1600.

4
<PAGE> 6

THE OFFERING

Common Stock offered by the Company......... 2,600,000 shares

Common Stock to be outstanding after the
Offering.................................... 9,405,605 shares (1)

Use of proceeds............................. To pay the cash portion of the
purchase price for the Founding
Companies and to repay certain
indebtedness. See "Use of
Proceeds."

Proposed NYSE Symbol........................ POV
- ---------------
(1) Includes 3,826,815 shares of Common Stock to be issued to the stockholders
of the Founding Companies in connection with the Combination. Excludes: (i)
up to an aggregate of 1,325,000 shares of Common Stock that may be issued as
Additional Consideration to the stockholders of six of the Founding
Companies (assuming an initial public offering price of $12.00 per share) as
well as shares of Common Stock that may be issued as Star Contingent
Consideration; (ii) 1,100,000 shares of Common Stock reserved for issuance
under the Company's 1998 Equity Incentive Plan (of which options to purchase
833,464 shares will be outstanding upon the consummation of the Offering at
an exercise price per share equal to the initial public offering price);
(iii) 100,000 shares of Common Stock reserved for issuance under the
Company's Stock Plan for Non-Employee Directors (of which no options will be
outstanding upon the consummation of the Offering); (iv) 500,000 shares of
Common Stock reserved for issuance under the Company's 1998 Employee Stock
Purchase Plan; (v) 10,000 shares of Common Stock reserved for issuance upon
the exercise of an outstanding option having an exercise price of $5.00 per
share; and (vi) an aggregate of 793,656 shares of Common Stock reserved for
issuance upon the exercise of warrants granted to two of the Company's
executive officers, as more fully described under "Certain
Transactions -- Other Transactions; American Business Partners LLC."

5
<PAGE> 7

SUMMARY PRO FORMA COMBINED FINANCIAL DATA
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

Provant has conducted operations to date only in connection with the
Combination and the Offering, and will acquire the Founding Companies
simultaneously with and as a condition to the consummation of this Offering. For
financial statement presentation purposes, Provant has been designated as the
accounting acquiror. The following table presents summary pro forma combined
financial data of the Company, as adjusted for: (i) the consummation of the
Combination; (ii) certain pro forma adjustments to the historical financial
statements of the Founding Companies; and (iii) the consummation of the Offering
and the application of the net proceeds. See the Company's Unaudited Pro Forma
Combined Financial Statements, each of the Founding Companies' financial
statements and the notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
PRO FORMA COMBINED (1)
-----------------------------------
YEAR ENDED
JUNE 30, THREE MONTHS ENDED
1997 SEPTEMBER 30, 1997
------------ ------------------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenue.................................................... $ 68,846 $ 17,738
Cost of revenue............................................ 30,967 8,056
------- -------
Gross profit............................................... 37,879 9,682
Selling, general and administrative expenses (2)........... 28,663 8,319
Goodwill amortization (3).................................. 1,226 307
------- -------
Income from operations..................................... 7,990 1,056
Interest and other income (expense), net................... (73) 23
------- -------
Income before income taxes................................. 7,917 1,079
Provision for income taxes (4)............................. 3,703 558
------- -------
Net income................................................. $ 4,214 $ 521
======= =======
Net income per share....................................... $ 0.45 $ 0.06
======= =======
Shares used in computing net income per share (5).......... 9,405,605 9,405,605
</TABLE>

<TABLE>
<CAPTION>
SEPTEMBER 30, 1997
-----------------------------------
PRO FORMA
COMBINED (6) AS ADJUSTED (7)
------------ ------------------
<S> <C> <C>
BALANCE SHEET DATA:
Working capital (8)........................................ $(14,357) $ 11,209
Total assets............................................... 75,095 74,738
Long-term debt, net of current maturities.................. 1,481 1,481
Stockholders' equity....................................... 36,523 62,089
</TABLE>

- ---------------
(1) The pro forma combined statement of operations data assumes that the
Combination and the Offering were consummated on July 1, 1996, and is not
necessarily indicative of the results the Company would have obtained if
these events actually then occurred or of the Company's future results. The
pro forma combined statement of operations data is based on preliminary
estimates, available information and assumptions that management deems
appropriate, and should be read in conjunction with the other financial
statements and notes thereto included elsewhere in this Prospectus.

(2) Reflects pro forma adjustments to salary, bonuses and benefits paid to
certain of the owners of the Founding Companies to which they have agreed
prospectively (the "Compensation Differential"). For the year ended June 30,
1997 and the three months ended September 30, 1997, the Compensation
Differential was approximately $4.8 million and $1.3 million, respectively.

6
<PAGE> 8

(3) Reflects amortization of the goodwill to be recorded as a result of the
Combination over a 40-year period and computed on the basis described in the
Notes to the Unaudited Pro Forma Combined Financial Statements.

(4) Assumes that all income is subject to an effective corporate income tax rate
of 40%, and all goodwill from the Combination is non-deductible.

(5) Assumes an initial public offering price of $12.00 per share. Consists of:
(i) 3,826,815 shares to be issued to the stockholders of the Founding
Companies (without giving effect to the issuance of Additional Consideration
or the Star Contingent Consideration); (ii) 2,978,790 shares held by the
management and founders of Provant; and (iii) 2,600,000 shares to be sold in
the Offering.

(6) The pro forma combined balance sheet data assumes that the Combination was
consummated on September 30, 1997. The pro forma combined balance sheet data
is based upon preliminary estimates, available information and assumptions
that management deems appropriate and should be read in conjunction with the
other financial statements and notes thereto included elsewhere in this
Prospectus.

(7) Adjusted for the sale of 2,600,000 shares of Common Stock offered hereby
(assuming an initial public offering price of $12.00 per share) and the
application of the net proceeds therefrom as described under "Use of
Proceeds."

(8) The pro forma combined data gives effect to $22.5 million representing the
cash portion of the consideration for the Combination to be paid from a
portion of the net proceeds of the Offering.

7
<PAGE> 9

SUMMARY INDIVIDUAL FOUNDING COMPANY FINANCIAL DATA
(IN THOUSANDS)

The following table presents summary data for each of the Founding
Companies on a historical (and, with respect to Star, consolidated) basis for
the periods indicated. (See "Combination" for the complete name of each Founding
Company.) Three of the Founding Companies, J. Howard, LSS and Star, historically
operated with fiscal years ending on dates other than June 30. For purposes of
the table below, their operating results have been recast to reflect a June 30
fiscal year end, although they have been derived from financial statements
prepared on the same basis as the audited financial statements. As a result of
this presentation, the operating results for these three companies do not
conform with their audited financial statements contained elsewhere in this
Prospectus.

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEARS ENDED JUNE 30, SEPTEMBER 30,
--------------------------- ---------------
1995 1996 1997 1996 1997
------- ------- ------- ------ ------
<S> <C> <C> <C> <C> <C>
BTI:
Revenue.......................................... $ 3,803 $ 5,685 $ 7,096 $1,712 $1,977
Gross profit..................................... 2,754 4,190 5,608 1,325 1,592
Income from operations........................... 439 142 497 356 286
Pro forma income from operations (1)............. 350 705 1,439 356 623
DECKER:
Revenue.......................................... $ 8,550 $ 8,620 $ 8,410 $1,930 $2,585
Gross profit..................................... 6,131 5,965 6,135 1,381 1,925
Income from operations........................... 461 249 514 120 262
Pro forma income from operations (1)............. 653 441 854 180 372
J. HOWARD:
Revenue.......................................... $ 5,444 $ 7,388 $ 7,317 $1,861 $1,917
Gross profit..................................... 3,646 5,084 5,157 1,275 1,256
Income from operations........................... 519 720 602 459 57
Pro forma income from operations (1)............. 701 1,265 1,548 518 242
LSS (2):
Revenue.......................................... $ 2,983 $ 4,233 $ 5,599 $1,136 $1,050
Gross profit..................................... 1,903 2,549 3,671 755 541
Income (loss) from operations.................... 209 381 610 168 (48)
Pro forma income from operations (1)............. 573 940 1,928 381 75
MOHR:
Revenue.......................................... $ 1,459 $ 2,171 $ 3,015 $ 554 $ 556
Gross profit..................................... 1,288 1,494 2,190 367 352
Income (loss) from operations.................... (26) 343 445 (16) (210)
Pro forma income (loss) from operations (1)...... 47 487 779 44 (105)
NOVATIONS:
Revenue.......................................... $ 7,175 $ 9,039 $ 9,018 $2,167 $2,464
Gross profit..................................... 3,290 4,306 4,179 1,050 1,267
Income from operations........................... 123 212 864 227 179
Pro forma income from operations (1)............. 1,331 1,683 1,525 401 554
STAR:
Revenue.......................................... $11,875 $14,361 $20,790 $4,931 $5,770
Gross profit..................................... 4,507 5,704 8,188 2,431 2,386
Income from operations........................... 1,286 292 1,127 711 496
Pro forma income from operations (1)............. 1,116 696 1,368 787 541
</TABLE>

- ---------
(1) Reflects adjustments to the compensation of certain executives of the
Founding Company to reflect the portion of the Compensation Differential
attributable to such company. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations."

(2) Includes 1995 data for LSS for the 12 months ended August 31, 1995.

8
<PAGE> 10

RISK FACTORS

The following factors should be considered, together with the other
information in this Prospectus, in evaluating an investment in the Company. This
Prospectus contains, in addition to historical information, forward-looking
statements that involve risks and uncertainties. The Company's actual results
could differ significantly from the results discussed in the forward-looking
statements as a result of any number of factors, including the risk factors set
forth below and other factors discussed elsewhere in this Prospectus.

ABSENCE OF COMBINED OPERATING HISTORY; RISKS OF INTEGRATION

Provant has conducted no operations and generated no revenues to date.
Provant has entered into definitive agreements to acquire the Founding Companies
simultaneously with, and as a condition to, the consummation of the Offering. To
date, the Founding Companies have operated independently of one another.
Currently, the Company has no centralized financial reporting system and
initially will rely on the existing reporting systems of the Founding Companies.
The Company's senior management group has been assembled only recently, and
there can be no assurance that this group will be successful in managing the
combined operations of the Founding Companies or in implementing the Company's
business and growth strategies. Any failure to do so could have a material
adverse effect on the Company's business, financial condition and results of
operations. See "Management."

The Founding Companies offer different services and products, use different
capabilities and technologies, target different clients and have different
management styles. Although the Company believes that there are substantial
opportunities to cross-market and integrate the Founding Companies' businesses,
these differences increase the risk inherent in integration. There can be no
assurance that the Company will be able to integrate successfully the operations
of the Founding Companies or institute the necessary Company-wide systems and
procedures to manage successfully the combined enterprise on a profitable basis.
The Company intends to operate the Founding Companies and subsequently acquired
businesses on a decentralized basis. If proper overall business incentives and
controls are not implemented, this decentralized operating strategy could result
in inconsistent operating and financial practices and the Company's overall
profitability could be adversely affected. The failure of the Company to
integrate successfully the operations of the Founding Companies could have a
material adverse effect on the Company's business, financial condition and
results of operations. See "Business -- Business Strategy."

RISKS RELATED TO INTERNAL GROWTH STRATEGY

The central objective of the Company's growth strategy is to increase the
revenues and profitability of the Founding Companies. One of the key components
of this strategy is to cross-sell the services and products of each Founding
Company to other clients of the Company. There can be no assurance that the
Company will be able to expand its sales of services and products to its
existing clients and those of any subsequently acquired businesses. The
Company's growth strategy of broadening its service and product offerings,
implementing an aggressive marketing plan, pursuing strategic acquisitions and
deploying leading technologies has inherent risks and uncertainties. There can
be no assurance that the Company's growth strategy will be successful or that
the Company will be able to generate cash flow sufficient to fund its operations
and to support internal growth. The Company's inability to achieve internal
earnings growth or otherwise execute its growth strategy could have a material
adverse effect on the Company's business, financial condition and results of
operations. See "Business -- Growth Strategy."

RISKS ASSOCIATED WITH ACQUISITION STRATEGY

The Company intends to increase its revenues and its service and product
offerings in part through the acquisition of additional providers of training
and development services and products. There can be no assurance that the
Company will be able to identify and acquire additional businesses or integrate
and manage any acquired businesses without substantial costs, delays or other
operational or financial problems. Certain risks inherent in an acquisition
strategy, such as potentially increasing leverage and debt service requirements,
difficulties associated with combining disparate business systems and cultures,
and the failure to retain key

9
<PAGE> 11

personnel, could adversely affect the Company's operating results. The process
of integrating acquired companies may involve unforeseen difficulties and
require a disproportionate amount of management's attention and financial and
other resources. Moreover, increased competition for acquisition candidates may
develop, in which event fewer acquisition opportunities may be available to the
Company and acquisition costs may increase. There can be no assurance that any
business acquired in the future will achieve anticipated revenues and earnings.
In addition, the size, timing and integration of acquisitions may cause
substantial fluctuations in the Company's operating results from quarter to
quarter. The inability of the Company to acquire, integrate and manage
successfully providers of training and development services and products could
have a material adverse effect on the Company's business, financial condition
and results of operations. See "Business -- Growth Strategy."

MANAGEMENT OF GROWTH

The Company expects to grow internally and through acquisitions. The
Company expects to spend significant time and effort in expanding its existing
business and identifying, completing and integrating acquisitions. There can be
no assurance that the Company's systems, procedures and controls will be
adequate to support the Company's operations as they expand. Any future growth
also will impose significant added responsibilities on members of senior
management, including the need to identify, recruit and integrate new senior
level managers and executives. There can be no assurance that such additional
management can be identified and retained by the Company. The inability of the
Company to manage its growth or recruit and retain additional qualified
management could have a material adverse effect on the Company's business,
financial condition and results of operations. See "Business -- Growth Strategy"
and "Management."

DEPENDENCE ON KEY PERSONNEL

The Company's operations will depend on the continuing efforts of its
executive officers and the senior management of the Founding Companies. In
particular, the Company will depend on: Paul M. Verrochi, Chairman and Chief
Executive Officer; John H. Zenger, President; and Dominic J. Puopolo, Executive
Vice President and Chief Financial Officer. In addition, the Company relies on
many of the executives of the Founding Companies, whose reputations and client
relationships have contributed in large part to those companies' success. While
the Company will enter into employment agreements with most of these
individuals, there can be no assurance that the Company will be able to retain
the services of any of them. A loss of the services of any of these individuals
following the Offering, could have a material adverse effect on the Company's
business, financial condition and results of operations. See "Management."

DEPENDENCE ON AVAILABILITY OF QUALIFIED PERSONNEL

A significant portion of the Company's revenue is derived from services and
products that are delivered by instructors and consultants. The Company's
success depends upon its ability to continue to attract and retain instructors
and consultants who possess the skills and experience required to meet the
staffing needs of its clients. In order to initiate and develop client
relationships and execute its growth strategy, the Company must maintain and
continue to hire qualified salespeople. There can be no assurance that qualified
personnel will continue to be available to the Company in sufficient numbers,
and any failure to attract or retain qualified instructors, consultants and
salespeople in sufficient numbers could have a material adverse effect on the
Company's business, financial condition and results of operations.

RISKS ASSOCIATED WITH CHANGING ECONOMIC CONDITIONS

The Company's revenues and profitability are related to general levels of
economic activity and employment in the United States. As a result, any
significant economic downturn or recession in the United States could have a
material adverse effect on the Company's business, financial condition and
results of operations.

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<PAGE> 12

FLUCTUATIONS IN OPERATING RESULTS

The Founding Companies have experienced and expect to continue to
experience fluctuations in quarterly operating results. Results for any quarter
therefore are not necessarily indicative of the results that the Company may
achieve for any subsequent quarter or a full fiscal year. Quarterly results may
vary materially as a result of, among other factors, the level of training and
development services and products sold, the gain or loss of material client
relationships, the timing, structure and magnitude of acquisitions, or the
utilization rates of the Company's salaried trainers, consultants and certain
other employees. The timing or completion of client engagements or custom
services and products also could result in fluctuations in the Company's results
of operations for particular quarterly periods. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations."

RELIANCE ON FEDERAL GOVERNMENT CONTRACTING

Approximately 31% of the Company's pro forma revenue in fiscal 1997 was
generated from services and products provided to over 75 federal government
entities. A general reduction in expenditures by the federal government for
training and development, a Congressional budget impasse, a reduction or
elimination of the use of third party contractors by the federal government, or
an inability of the Company to maintain its relationship with these government
entities could have a material adverse effect on the Company's business,
financial condition and results of operations. In addition, the government
typically shares equally in the ownership of courseware and materials that the
Company develops with government funds, and may share such courseware or
materials with other entities including the Company's competitors. Risks unique
to contracts with federal government entities including potential government
audits and retroactive downward repricing of sales could, if realized, have a
material adverse effect on the Company's business, financial condition and
results of operations.

Some of the Company's contracts require a security clearance from the
federal government. Foreign beneficial ownership of Common Stock following the
Offering in excess of 5% of outstanding amounts may require the Company to place
restrictions on foreign ownership, control, or influence over these contracts.
If the government deems such controls to be inadequate to prevent foreign
control or influence and terminates the classified contracts, there could be a
material adverse effect on the Company's business, financial condition and
results of operations.

RISKS ASSOCIATED WITH INTELLECTUAL PROPERTY

The Company regards many of its training and development services and
products as proprietary and relies primarily on a combination of statutory and
common law copyright, trademark, service mark and trade secret laws, customer
licensing agreements, employee and third-party nondisclosure agreements and
other methods to protect its proprietary rights. Notwithstanding the foregoing,
a third party or parties could copy or otherwise obtain and use the Company's
products in an unauthorized manner or use these products to develop training and
development processes that are substantially similar to those of the Company.
The Company's products generally do not include any mechanisms to prohibit or
prevent unauthorized use by third parties. If substantial unauthorized use of
the Company's products were to occur, there could be a material adverse effect
on the Company's business, financial condition and results of operations. There
can be no assurance that the Company's means of protecting its proprietary
rights will be adequate or that the Company's competitors will not independently
develop similar training products and delivery methods. Additionally, there can
be no assurance that third parties will not claim that the Company's current or
future products or services infringe on the proprietary rights of others. The
Company expects that it will be increasingly subject to such claims as the
number of products and competitors increases in the future. Any such claim could
have a material adverse effect on the Company's business, financial condition
and results of operations. See "Business -- Intellectual Property."

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<PAGE> 13

TECHNOLOGICAL RISK

Traditionally, most of the Company's training and development services and
products have been delivered through instructors, written materials or video.
The Company intends to deliver many of its training and development services and
products, including certain services and products previously delivered in
"traditional" formats, via interactive multimedia software (such as CD-ROM) and
distance-based media (such as video conferencing, intranets and the Internet).
There can be no assurance that the Company will be successful in marketing its
services and products in multimedia software and distance-based media formats,
nor can there be assurance that services and products delivered in the newer
formats will provide comparable training results. In addition, there can be no
assurance that any successful expansion of the methods of distribution of the
Company's services and products will not be rendered moot by subsequent
technological advances. Finally, adding new distribution channels for its
services and products may entail significant costs. The inability of the Company
to develop new distribution channels due to capital, personnel, technological or
other constraints could result in a material adverse effect on the Company's
business, financial condition and results of operations. See "Business -- Growth
Strategy."

RISKS RELATED TO ACQUISITION FINANCING

The Company may choose to finance future acquisitions by issuing shares of
Common Stock for all or a portion of the consideration to be paid. In the event
that the Common Stock does not maintain a sufficient market value, or potential
acquisition candidates otherwise are unwilling to accept Common Stock as part of
the consideration for the sale of their businesses, the Company might not be
able to utilize Common Stock as consideration for acquisitions and would be
required to utilize more of its cash resources, if available, in order to
maintain its acquisition program. If the Company does not have sufficient cash
resources, its growth could be limited unless it could obtain additional capital
through debt or equity financings. The inability of the Company to use its
Common Stock as consideration for future acquisitions or to obtain additional
financing for acquisitions could have a material adverse effect on the Company's
business, financial condition and results of operations. In addition, there can
be no assurance that future issuances of Common Stock in connection with
acquisitions will not be dilutive to the Company's stockholders.

INDEPENDENT CONTRACTOR STATUS

The Company uses many contract instructors who are not employees of the
Company. As a result, the Company does not pay federal employment taxes or
withhold income taxes on behalf of such individuals, or include them in its
employee benefit plans. If state or federal taxing authorities were to require
the Company to treat some or all of its contract instructors as employees, the
Company would become responsible for the taxes required to be paid or withheld
and could incur additional costs associated with employee benefits and other
employee costs on both a current and retroactive basis. The aggregate impact of
such costs could have a material adverse effect on the Company's business,
financial condition and results of operations. See "Business -- Independent
Contractors."

COMPETITION

The training and development industry is highly fragmented and competitive,
with low barriers to entry and no single competitor accounting for a significant
market share. The Company's competitors include several large publicly traded
and privately held companies, and thousands of small privately held training
providers and individuals. In addition, many of the Company's clients maintain
internal training departments. Some of the Company's competitors offer services
and products that are similar to those of the Company at lower prices, and some
competitors have significantly greater financial, managerial, technical,
marketing and other resources than the Company. Moreover, the Company expects
that it will face additional competition from new entrants into the training and
development market due, in part, to the evolving nature of the market and the
relatively low barriers to entry. There can be no assurance that the Company
will be successful against such competition. See "Business -- Competition."

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<PAGE> 14

CONTROL BY DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL STOCKHOLDERS

Upon completion of the Offering, the Company's directors and executive
officers, together with their affiliates, will beneficially own approximately
47.3% of the Company's outstanding shares of Common Stock (approximately 45.4%
if the Underwriters exercise their over-allotment option in full). As a result,
these stockholders, if they were to act together, would have the ability as a
practical matter to determine the outcome of corporate actions requiring
stockholder approval, including the election of directors and the approval of
significant corporate transactions, such as a merger or sale of substantially
all of the Company's assets, regardless of how other stockholders of the Company
may vote. This concentration of ownership may have the effect of delaying or
preventing a change in control of the Company. See "Management" and "Principal
Stockholders."

POSSIBLE FUTURE SALES OF SHARES

Sales of substantial amounts of Common Stock in the public market after the
Offering under Rule 144 under the Securities Act of 1933, as amended (the
"Securities Act"), or otherwise, or the perception that such sales could occur,
may adversely affect prevailing market prices of the Common Stock and could
impair the future ability of the Company to raise capital through an offering of
its equity securities or to effect acquisitions using shares of its Common
Stock. The shares of Common Stock outstanding prior to the Offering and the
shares to be issued in the Combination will be "restricted securities" within
the meaning of Rule 144. Unless the resale of the shares is registered under the
Securities Act, these shares may not be sold in the open market until after the
first anniversary of the transaction in which they were acquired, and then only
in compliance with the applicable requirements of Rule 144. See "Shares Eligible
for Future Sale." Notwithstanding their right under the Securities Act to sell
shares pursuant to Rule 144, the stockholders of the Founding Companies and the
holders of Provant's Common Stock prior to the Combination and the Offering have
agreed with the Company to certain transfer restrictions for a two-year period
following the Offering on the Common Stock held by them as of the closing of the
Offering and on the Common Stock that may be purchased by them under options and
warrants outstanding as of the closing of the Offering. See "Certain
Transactions -- Organization of the Company" and "-- Other Transactions
Involving Officers and Directors."

The Company, the holders of all shares outstanding prior to the Offering
and all stockholders of the Founding Companies have agreed with the
Representatives of the Underwriters not to sell or otherwise dispose of any
shares of Common Stock, or any securities convertible into or exercisable or
exchangeable for shares of Common Stock, for a period of 180 days after the date
of this Prospectus without the written consent of the Representatives, except
for: (i) in the case of the Company, the grant of options under the Company's
benefit plans or in connection with acquisitions and (ii) in the case of all
such holders, the exercise of stock options pursuant to benefit plans described
herein and shares of Common Stock disposed of as bona fide gifts, subject, in
each case, to any remaining portion of the 180-day period applying to any shares
so issued or transferred. See "Shares Eligible for Future Sale" and
"Underwriting."

CERTAIN ANTI-TAKEOVER PROVISIONS

The Company's Certificate of Incorporation requires that any action
required or permitted to be taken by stockholders of the Company must be
effected at a duly called annual or special meeting of stockholders and may not
be effected by any consent in writing. Special meetings of stockholders may be
called only by the Chairman of the Board or President of the Company or by the
Board of Directors. In addition, the Board of Directors has the authority,
without further action by the stockholders, to fix the rights and preferences
and issue up to 5,000,000 shares of Preferred Stock. These provisions and other
provisions of the Certificate of Incorporation and By-laws may have the effect
of deterring unsolicited acquisition proposals or hostile takeovers or delaying
or preventing changes in control or management of the Company, including
transactions in which stockholders might otherwise receive a premium over the
then current market price for their shares of Common Stock. In addition, these
provisions may limit the ability of stockholders to approve transactions that
they may deem to be in their best interests. The Company also is subject to
Section 203 of the Delaware General Corporation Law (the "DGCL"), which, subject
to certain exceptions, prohibits a Delaware

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<PAGE> 15

corporation from engaging in any of a broad range of business combinations with
any "interested stockholder" for a period of three years following the date that
such stockholder became an interested stockholder. See "Description of Capital
Stock."

NO PRIOR MARKET FOR COMMON STOCK AND POSSIBLE VOLATILITY OF STOCK PRICE

Prior to the Offering, there has been no public market for the Common
Stock, and there can be no assurance that an active public market for the Common
Stock will develop or continue after the Offering. The initial public offering
price of the Common Stock will be determined by negotiations between the Company
and the Representatives of the Underwriters, and may not be indicative of the
market price for the Common Stock after the Offering. See "Underwriting" for a
description of the factors to be considered in determining the initial public
offering price. After the Offering, the market price of the Common Stock may be
subject to significant fluctuations in response to numerous factors, including
variations in the annual or quarterly financial results of the Company or its
competitors, changes by financial research analysts in their estimates of the
earnings of the Company or the failure of the Company to meet such estimates,
conditions in the economy in general or the training and development industry in
particular, or unfavorable publicity affecting the Company or the industry. The
equity markets have, on occasion, experienced significant price and volume
fluctuations that have affected the market prices for many companies' securities
and have been unrelated to the operating performance of those companies. Any
such fluctuations following completion of the Offering may adversely affect the
prevailing market price of the Common Stock.

IMMEDIATE AND SUBSTANTIAL DILUTION

The purchasers of the shares of Common Stock offered hereby will experience
immediate and substantial dilution in the net tangible book value of their
shares of Common Stock in the amount of $10.61 per share, and may experience
further dilution in that value from issuances of Common Stock in connection with
future acquisitions. See "Dilution."

ABSENCE OF DIVIDENDS

Provant has never paid dividends on the Common Stock and does not
anticipate paying any dividends in the foreseeable future. Declarations of
dividends on the Common Stock will depend upon, among other things, future
earnings, if any, the operating and financial condition of the Company, its
capital requirements and general business conditions. The Company anticipates
that any future credit facility that it may obtain will prohibit dividend
payments. See "Dividend Policy."

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<PAGE> 16

COMBINATION

Provant's objective is to become a leading provider of training and
development services and products. Although Provant has conducted no operations
to date, it has entered into agreements to acquire the Founding Companies
simultaneously with, and as a condition to, the consummation of the Offering.
For a description of the transactions pursuant to which the Founding Companies
will be acquired by Provant, see "Certain Transactions -- Organization of the
Company."

THE FOUNDING COMPANIES

The seven Founding Companies are recognized leaders in their respective
fields and have developed a broad array of services and products, a substantial
knowledge base created from years of research and development, and a
well-established client base. Set forth below is a brief description of each of
the Founding Companies.

Behavioral Technology, Inc.: Behavioral Technology, Inc. ("BTI") was
founded by Paul C. Green, Ph.D. in 1978. BTI helps clients improve employee
selection and provides managers with a methodology for assessing strengths and
weaknesses of current employees. BTI trains clients to use candidates' and
employees' past actions both as indicators of future performance and as a basis
for discussion regarding improvement in performance. BTI's training services are
delivered through instructor-led training and train-the-trainer programs. The
company's lead product, Behavioral Interviewing(R), accounted for approximately
90% of the company's revenue in fiscal 1997. Dr. Green is credited with
developing the concepts behind behavioral-based interviewing and is widely
acknowledged as a leader in the field. BTI's clients include Hewlett-Packard
Company, Federal Express and Royal Bank of Canada. BTI is headquartered in
Memphis, Tennessee. In its most recent fiscal year, BTI generated revenue of
approximately $7.1 million.

Decker Communications, Inc.: Decker Communications, Inc. ("Decker") was
founded by Bert Decker in 1979. Decker provides training to improve employees'
business communication skills and communications between management and
employees. Decker's services range from helping senior management to communicate
corporate change to working with employees to improve the effectiveness of their
communication skills. Decker's training services are delivered primarily through
instructor-led workshops, some of which are tailored to meet specific client
objectives. Decker's flagship program, Effective Communicating(TM), and its
custom versions of the same product, accounted for approximately 84% of the
company's revenue in fiscal 1997. Decker's clients include Bank of America,
Coopers & Lybrand L.L.P. and Hewlett-Packard Company. Decker is located in San
Francisco, California and has regional offices in New York, Los Angeles and
Chicago. In its most recent fiscal year, Decker generated revenue of
approximately $8.4 million.

J. Howard & Associates, Inc.: J. Howard & Associates, Inc. ("J. Howard")
was founded by Jeffrey P. Howard, Ph.D. in 1977. Marc S. Wallace joined the
company in 1986, and became its President in 1991. J. Howard assists clients in
identifying and addressing potential obstacles to improving workplace
productivity, including race and gender issues, sexual harassment and failure of
employees to take measured risks. J. Howard's training services are delivered
primarily through instructor-led seminars that incorporate small and large group
discussions and self-assessment and skills-building exercises. The company's
lead product, Managing Inclusion, which accounted for approximately 57% of the
company's revenue in its fiscal year ended December 31, 1996, is a two-day
program designed to help individual managers and client companies understand the
ways in which diversity in the work force contributes to the productivity of an
organization. Other related programs include Risk Taking for Professional
Development, Efficacy for Professionals of Color, Efficacy for Women and
Exploring Diversity. J. Howard's clients include Bank of America, J.P. Morgan &
Co. Incorporated and Northwest Airlines, Inc. J. Howard is located in Lexington,
Massachusetts. In its fiscal year ended December 31, 1996, J. Howard generated
revenue of approximately $7.1 million.

Learning Systems Sciences: Robert Steinmetz, Ph.D., and Associates, Inc.,
d/b/a Learning Systems Sciences ("LSS"), was founded in 1979 by Robert A.
Steinmetz, Ph.D. In 1990 John F. King joined the company as President and a 50%
stockholder. LSS designs custom training products primarily for retailers using
multimedia, computer-based formats. LSS's products are designed to facilitate
faster learning of customer interface devices and higher productivity of retail
associates. LSS's training products are delivered

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<PAGE> 17

primarily through interactive multimedia software and distance-based media.
LSS's clients include Federated Department Stores, Inc., J.C. Penney Company,
Inc. and The Kroger Co. LSS is located in North Hollywood, California. In its
fiscal year ended December 31, 1996, LSS generated revenue of approximately $5.1
million.

MOHR Retail Learning Systems, Inc.: MOHR Retail Learning Systems, Inc.
("MOHR") was the retail training division of MOHR Development, Inc. from 1981 to
1991, when the division was purchased by Michael Patrick and one of the
division's founders, Herb Cohen. MOHR's services and products are designed to
help clients in the retail industry improve productivity by fostering a
customer-oriented focus at the sales management and sales associate levels. MOHR
offers its services and products through train-the-trainer seminars and by
licensing its text-based and video-based materials to its clients. MOHR's Retail
Management Series III and Creating Loyal Customers programs, which together
accounted for more than 60% of the company's revenue in fiscal 1997, utilize
well-established learning designs, instructional systems and feedback mechanisms
to train clients' employees to provide superior customer service. In addition,
the company's Bottom-Line Buying Plus program provides negotiation skills
training for buyers at retail organizations. MOHR's clients include Eckerd
Corporation, Victoria's Secret Stores and The Sports Authority, Inc. MOHR is
headquartered in Ridgewood, New Jersey. In its most recent fiscal year, MOHR
generated revenue of approximately $3.0 million.

Novations Group, Inc.: Novations Group, Inc. ("Novations") was founded in
1986 by Norman Smallwood, Jonathan Younger, Joe Folkman and Randy Stott. Joe
Hanson joined the company as a Managing Director in 1989. Novations assists
clients in, among other things, clarifying and communicating their business
strategies and re-designing their organizations and business processes.
Novations also provides its clients with a variety of organizational assessment
tools that are designed to gather and analyze feedback on either an
organizational or individual basis and to initiate change in response to such
feedback. In its most recent fiscal year, approximately 60% of Novations'
revenue was derived from strategic consulting services provided to organizations
in industries such as the petrochemical, financial services, consumer products,
transportation and telecommunications industries. The balance of the company's
revenue resulted from sales to clients of organizational assessment tools
including the Organizational Analysis Survey, the Strategic Alignment Survey,
Total Quality Survey, Customer Service Survey and Leadership and Managerial
Profiles. Novations' clients include Eli Lilly and Company, Motorola, Inc. and
Yellow Corporation. Novations is headquartered in Provo, Utah, and has offices
in New York and Dallas. In its most recent fiscal year, Novations generated
revenue of approximately $9.0 million.

Star Mountain, Inc.: Star Mountain, Inc. (together with its subsidiaries,
"Star") was founded by A. Carl von Sternberg in 1987. Star's core business
consists of providing customized training services and products to individuals
within federal, state and local government entities and corporations. In
addition, Star provides a limited amount of computer network design, sales,
installation and support, and computer network security research and
development. Star delivers its training courseware to clients in a variety of
formats (including written materials and interactive multimedia software), but
typically does not directly train its clients. Approximately 32% of Star's
revenue in its fiscal year ended December 31, 1996 was derived from the United
States Department of Defense, 43% from other federal entities, 1% from state and
local government entities, and the remainder from corporations. In addition to
the Department of Defense, Star's largest government clients include the
Internal Revenue Service and the Immigration and Naturalization Service. Star is
headquartered in Alexandria, Virginia and has 17 branch offices located
throughout the United States. In its fiscal year ended December 31, 1996, Star
generated revenue of approximately $16.3 million. In addition, Star acquired
three businesses since September 1996 that, had they been acquired on January 1,
1996, would have contributed an additional $8.5 million to Star's revenue in the
1996 calendar year.

MERGER CONSIDERATION

The aggregate consideration to be paid by Provant at the closing of the
Combination is $68.4 million, consisting of $22.5 million in cash (representing
approximately 85.5% of the net proceeds of the Offering) and 3,826,815 shares of
Common Stock (assuming an initial public offering price of $12.00 per share). If
the initial public offering price is other than $12.00 per share, the number of
shares issued to the former stockholders of the Founding Companies will be
increased or decreased so that such stockholders receive an

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<PAGE> 18

aggregate of $45.9 million of Common Stock valued at the initial public offering
price. However, the total number of shares of Common Stock outstanding following
the Combination will not vary as a result of an initial public offering price of
other than $12.00 per share because the size of the stock dividend that will be
declared by Provant prior to the consummation of the Combination will increase
as the initial offering price increases and decrease as the initial offering
price decreases. As a result, upon the consummation of the Combination (but
without giving effect to the Offering), there will be outstanding a total of
6,805,605 shares of Common Stock.

In addition to the consideration described above, the former stockholders
of six of the Founding Companies will be eligible to receive up to an aggregate
of 1,325,000 additional shares of Common Stock (assuming an initial public
offering price of $12.00 per share) (the "Additional Consideration") if
specified levels of earnings before interest and taxes ("EBIT") are reached by
their respective companies. In the case of the seventh Founding Company, Star,
Provant has agreed to make a future payment in cash or shares of Common Stock
based on Star's EBIT for fiscal 1999 (the "Star Contingent Consideration"). In
connection with the Combination, the Company will repay approximately $2.9
million of indebtedness of the Founding Companies from the net proceeds of the
Offering. The consideration to be paid by Provant for each Founding Company was
determined by arm's length negotiations between Provant and representatives of
each Founding Company and was based primarily on the pro forma EBIT of each
Founding Company. Additional Consideration paid for a Founding Company and the
Star Contingent Consideration represent, in effect, an upward adjustment in
purchase price. For a more detailed description of these transactions, see
"Certain Transactions -- Organization of the Company."

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<PAGE> 19

USE OF PROCEEDS

The net proceeds to the Company from the sale of the 2,600,000 shares of
Common Stock offered hereby (assuming an initial public offering price of $12.00
per share), after deducting the estimated underwriting discount and estimated
Offering expenses, are estimated to be approximately $26.3 million ($30.6
million if the Underwriters' over-allotment option is exercised in full). Of the
net proceeds, approximately $22.5 million will be used to pay the cash portion
of the purchase price for the Founding Companies. In addition, the Company
currently intends to use approximately $2.9 million of the net proceeds to repay
certain indebtedness of the Founding Companies assumed in connection with the
Combination (which indebtedness bears interest at a weighted average interest
rate of 9.0% and matures at various dates through February 2001). The Company
also intends to use $750,000 to pay a fee due upon the closing of the Offering
to a third party for information provided to Provant relating to the training
and development industry.

The Company intends to use approximately $193,000 to repay in part a note
payable of the Company to Paul M. Verrochi and Dominic J. Puopolo. See "Certain
Transactions -- Other Transactions; American Business Partners LLC." Of this
amount, approximately $50,000 is attributable to expenses relating to the
Offering. Pending the use of the net proceeds of the Offering for the purposes
described above, the Company will invest such proceeds in short-term,
interest-bearing, investment grade securities.

DIVIDEND POLICY

The Company intends to retain all of its earnings, if any, to finance the
expansion of its business and for general corporate purposes, including future
acquisitions, and does not anticipate paying cash dividends on its Common Stock
in the foreseeable future. Any future determination as to the payment of
dividends on the Common Stock will be at the discretion of the Board of
Directors and will depend upon, among other things, the Company's future
earnings, if any, the operating and financial condition of the Company, its
capital requirements, general business conditions and any other factors the
Board of Directors of the Company may consider. In addition, in the event that
the Company is successful in obtaining a credit facility at any point in the
future, it is likely that any such facility will include restrictions on the
Company's ability to pay dividends without the consent of the lender.

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<PAGE> 20

CAPITALIZATION

The following table sets forth the short-term debt, including the current
maturities of long-term debt, and capitalization of the Company at September 30,
1997: (i) on a pro forma combined basis to give effect to the Combination, the
increase in the Company's authorized shares of Common Stock, the authorization
of a class of preferred stock and the declaration of a stock dividend; and (ii)
as further adjusted to give effect to the issuance of the 2,600,000 shares of
Common Stock offered hereby and the application of the estimated net proceeds.
See "Use of Proceeds." This table should be read in conjunction with the
Unaudited Pro Forma Combined Financial Statements of the Company and the related
notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
SEPTEMBER 30, 1997
-------------------------
PRO FORMA
COMBINED
(1) AS ADJUSTED
----------- -----------
(IN THOUSANDS)
<S> <C> <C>
Short-term debt, including current maturities of long-term debt (2)... $ 2,980 $ 80
====== ======
Long-term debt, less current maturities (2)........................... $ 1,481 $ 1,481
Stockholders' Equity:
Preferred Stock, $0.01 par value; 5,000,000 shares authorized, none
issued or outstanding, pro forma and as adjusted................. -- --
Common Stock, $0.01 par value; 40,000,000 shares authorized,
6,805,605 shares issued and outstanding, pro forma; and 9,405,605
shares issued and outstanding, as adjusted (3)................... 38 64
Additional paid-in capital.......................................... 36,699 62,989
Retained earnings................................................... (214) (964)
------ ------
Total stockholders' equity....................................... 36,523 62,089
------ ------
Total capitalization........................................ $38,004 $63,570
====== ======
</TABLE>

- ---------------
(1) Combines the respective accounts of Provant and the Founding Companies at
September 30, 1997 and gives effect to the reclassification of the Founding
Companies' common stock as additional paid-in capital.

(2) For a description of the Company's debt, see the notes to the financial
statements of each of the Founding Companies.

(3) Excludes: (i) up to an aggregate of 1,325,000 shares of Common Stock
(assuming an initial public offering price of $12.00 per share) that may be
issued as Additional Consideration to the former stockholders of six of the
Founding Companies as well as shares of Common Stock that may be issued as
Star Contingent Consideration; (ii) 1,100,000 shares of Common Stock
reserved for issuance under the Company's 1998 Equity Incentive Plan (of
which options to purchase 833,464 shares will be outstanding upon the
consummation of the Offering at an exercise price per share equal to the
Offering price); (iii) 100,000 shares of Common Stock reserved for issuance
under the Company's Stock Plan for Non-Employee Directors (of which no
options will be outstanding upon the consummation of the Offering); (iv)
500,000 shares of Common Stock reserved for issuance under the Company's
1998 Employee Stock Purchase Plan; (v) 10,000 shares of Common Stock
reserved for issuance upon the exercise of an outstanding option having an
exercise price of $5.00 per share; and (vi) an aggregate of 793,656 shares
of Common Stock reserved for issuance upon the exercise of warrants granted
to certain of the Company's executive officers, as more fully described
under "Certain Transactions -- Other Transactions; American Business
Partners LLC."

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<PAGE> 21

DILUTION

The pro forma net tangible book value of the Company as of September 30,
1997 was approximately $(12.5) million, or $(1.84) per share. Net tangible book
value per share represents the book value of the Company's pro forma net
tangible assets less total liabilities divided by the number of shares of Common
Stock outstanding (after giving effect to the Combination). After giving effect
to the sale by the Company of 2,600,000 shares of Common Stock in the Offering
(after deducting the estimated underwriting discount and estimated Offering
expenses) and the application of the net proceeds therefrom, the pro forma net
tangible book value at September 30, 1997 would have been approximately $13.0
million, or $1.39 per share. This represents an immediate increase in pro forma
net tangible book value per share of $3.23 to stockholders as of September 30,
1997, and an immediate dilution in pro forma net tangible book value per share
of $10.61 to new investors purchasing shares of Common Stock in the Offering.
The following table illustrates this per share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price................................ $12.00
------
Pro forma net tangible book value per share before Offering........ $(1.84)
Increase in pro forma net tangible book value per share
attributable to new investors...................................... 3.23
------
Pro forma net tangible book value per share after Offering......... 1.39
------
Dilution per share to new investors................................ $10.61
======
</TABLE>

The following table sets forth, on a pro forma basis to give effect to the
Combination, the number of shares of Common Stock purchased from the Company,
the total consideration paid and the average price per share paid by the
Company's existing stockholders and by investors purchasing shares of Common
Stock offered hereby:

<TABLE>
<CAPTION>
SHARES PURCHASED AVERAGE
---------------------- TOTAL PRICE
NUMBER PERCENT CONSIDERATION (1) PER SHARE
---------- ------- ----------------- ---------
<S> <C> <C> <C> <C>
Existing stockholders....... 6,805,605 72.4% $ (12,527,000) $ (1.84)
New investors............... 2,600,000 27.6 31,200,000 12.00
---------- ----- ------------
Total............. 9,405,605 100.0% $ 18,673,000
========== ===== ============
</TABLE>

- ---------------

(1) Total consideration paid by existing stockholders represents the combined
stockholders' equity of the Founding Companies before the Offering, adjusted
to reflect: (i) the cash portion of the consideration payable to the
stockholders of the Founding Companies in connection with the Combination;
and (ii) the payment of distributions estimated at approximately $1.4
million which certain of the Founding Companies are expected to make to
their stockholders prior to the closing of the Combination. See "Use of
Proceeds" and "Capitalization."

20
<PAGE> 22

SELECTED FINANCIAL DATA
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

Provant will acquire the Founding Companies simultaneously with and as a
condition to the consummation of the Offering. For financial reporting purposes,
Provant has been designated as the accounting acquiror. To date, Provant has
conducted operations only in connection with the Combination and the Offering.
As a result, Provant has generated no revenue. The following selected unaudited
pro forma combined financial data present data for the Company, adjusted for:
(i) the consummation of the Combination; (ii) certain pro forma adjustments to
the historical financial statements of the Founding Companies; and (iii) the
consummation of the Offering and the application of the net proceeds. See the
Company's Unaudited Pro Forma Combined Financial Statements, each of the
Founding Companies' financial statements and the notes thereto included
elsewhere in this Prospectus.

<TABLE>
<CAPTION>
PRO FORMA COMBINED (1)
--------------------------------------
YEAR ENDED THREE MONTHS ENDED
JUNE 30, 1997 SEPTEMBER 30, 1997
------------- --------------------
<S> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenue..................................................... $ 68,846 $ 17,738
Cost of revenue............................................. 30,967 8,056
------- -------
Gross profit................................................ 37,879 9,682
Selling, general and administrative expenses (2)............ 28,663 8,319
Goodwill amortization (3)................................... 1,226 307
------- -------
Income from operations...................................... 7,990 1,056
Interest and other income (expense), net.................... (73) 23
------- -------
Income before provision for income taxes.................... 7,917 1,079
Provision for income taxes (4).............................. 3,703 558
------- -------
Net income.................................................. $ 4,214 $ 521
======= =======
Net income per share........................................ $ 0.45 $ 0.06
======= =======
Shares used in computing net income per share (5)........... 9,405,605 9,405,605
</TABLE>

<TABLE>
<CAPTION>
SEPTEMBER 30, 1997
--------------------------------
PRO FORMA
COMBINED (6) AS ADJUSTED (7)
------------ ---------------
<S> <C> <C>
BALANCE SHEET DATA:
Working capital (8)............................................ $(14,357) $11,209
Total assets................................................... 75,095 74,738
Long-term debt, net of current maturities...................... 1,481 1,481
Stockholders' equity........................................... 36,523 62,089
</TABLE>

(2) Reflects pro forma adjustments to salary, bonuses and benefits paid to
certain of the owners of the Founding Companies for the Compensation
Differential, which for the year ended June 30, 1997 and the three months
ended September 30, 1997 was approximately $4.8 million and $1.3 million,
respectively.

21
<PAGE> 23

(4) Assumes that all income is subject to an effective corporate income tax rate
of 40%, and all goodwill from the Combination is non-deductible.

(8) The pro forma combined data gives effect to $22.5 million representing the
cash portion of the consideration for the Combination to be paid from a
portion of the net proceeds of the Offering.

22
<PAGE> 24

MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Unless otherwise indicated or the context otherwise requires in this
section, each reference to a year is to the Company's or a Founding Company's
fiscal year which (with the exception of J. Howard, LSS and Star) ends on June
30 of the same calendar year (e.g., "1997" means the fiscal year ended June 30,
1997). The following discussion should be read in conjunction with the Company's
Unaudited Pro Forma Combined Financial Statements and the Founding Companies'
Financial Statements and the related notes thereto appearing elsewhere in this
Prospectus.

INTRODUCTION

The Company receives revenue from five main areas: (i) instructor-led and
train-the-trainer seminars; (ii) license fees; (iii) custom services and
products; (iv) consulting services; and (v) off-the-shelf products. The Company
recognizes revenue from instructor-led training and train-the-trainer seminars,
usually on a participant basis, when the training is delivered. From its
train-the-trainer arrangements, the Company also recognizes license fees on a
per-participant basis when a certified client trainer delivers the Company's
courses and materials to other employees of the client. The Company recognizes
revenue from a site license at the time the license is granted. The Company
generally recognizes revenue from its custom services and products based on the
percentage-of-completion method. The Company recognizes revenue from fees for
its consulting services, for which it charges an hourly or per diem rate, when
the consulting is provided. The Company also recognizes revenue for its
off-the-shelf products, such as books or videotapes, when the products are
delivered.

Cost of revenue primarily consists of: (i) salaries and benefits for the
Company's instructors, consultants and course designers and costs of independent
contractors; and (ii) the cost of developing, designing and producing training
courses and materials, including materials costs. As a result, the Company's
gross margins are affected by the number of instructors, consultants and course
designers and the utilization of such employees during any given period.
Selling, general and administrative expenses consist primarily of salaries,
benefits and bonuses for the Company's corporate, sales, marketing and
administrative personnel, and marketing and advertising expenses for the
Company's services and products. Selling, general and administrative expenses
also include incentive and discretionary bonuses paid to owners and other key
employees. Other selling, general and administrative expenses include travel
expenses, rent, depreciation, telecommunication costs, postage and other
operating costs.

The Founding Companies have operated throughout the periods presented as
independent, privately-owned entities, and their results of operations reflect
varying tax structures (S corporations or C corporations) which have influenced
the historical level of owners' compensation. The owners and key employees of
the Founding Companies have agreed to certain adjustments in their annual
historical salaries, bonuses and benefits in connection with the Combination.
The difference (positive or negative) between the base salary of the owners and
key employees of the Founding Companies immediately after the Combination and
their salaries, bonuses and benefits during any comparable period is referred to
as the "Compensation Differential". The aggregate Compensation Differentials for
1995, 1996 and 1997 and for the three months ended September 30, 1996 and 1997
were $1.8 million, $3.9 million, $4.8 million, $642,000, and $1.3 million,
respectively, and have been reflected as a pro forma adjustment in the Unaudited
Pro Forma Combined

23
<PAGE> 25

Statements of Operations. The Unaudited Pro Forma Combined Statements of
Operations include a provision for income tax as if the Company was taxed as a C
corporation.

Following the Combination, the Company expects to realize certain savings
as a result of: (i) consolidation of certain expenses, such as travel and
lodging, advertising, employee benefits, communications, insurance and other
general and administrative expenses; and (ii) the Company's ability to borrow at
lower interest rates than most of the Founding Companies. The Company cannot
quantify these savings until the completion of the Combination. It is
anticipated that these savings will be offset partially by the costs of being a
publicly held company and the incremental increase in costs related to the
Company's new management. However, these costs, like the savings that they
offset, cannot be quantified accurately. Neither the anticipated savings nor the
anticipated costs have been included in the pro forma financial information of
the Company.

In July 1996, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 97 ("SAB 97"), relating to business combinations
immediately prior to an initial public offering, which required that business
combinations like the Combination be accounted for using the purchase method of
acquisition accounting. Under the purchase method, Provant has been designated
as the accounting acquiror. Approximately $49.1 million, representing the excess
of the fair value of the consideration received in the Combination over the fair
value of the net assets to be acquired, will be recorded as goodwill on the
Company's balance sheet. Goodwill will be amortized as a non-cash charge to the
Company's income statement over a 40-year period. The pro forma impact of this
amortization expense is approximately $1.2 million per year. The amount
amortized, however, will not be deductible for tax purposes. See "Certain
Transactions -- Organization of the Company."

RESULTS OF OPERATIONS -- COMBINED

The summary combined Founding Company statement of operations data for
1995, 1996 and 1997 and the three months ended September 30, 1996 and 1997 set
forth in the table below do not purport to present the combined Founding
Companies in accordance with generally accepted accounting principles, but
represent merely a summation of the data of the individual Founding Companies on
a historical basis and do not include the effects of pro forma adjustments. This
data will not be comparable to and may not be indicative of the Company's
post-Combination results of operations because (i) the Founding Companies
historically were not under common control or management and had different tax
structures during the periods presented; (ii) the Company used the purchase
method of accounting to reflect the Combination, resulting in the recording of
goodwill which will be amortized over 40 years; (iii) the Company will incur
incremental costs related to its new corporate management and the costs of being
a public company; and (iv) the combined data does not reflect potential benefits
and cost savings the Company expects to realize when operating as a combined
entity.

The following table sets forth certain unaudited combined statement of
operations data of the Founding Companies on a historical basis and as a
percentage of revenue and excludes the effects of pro forma adjustments for the
periods indicated. Three of the Founding Companies, J. Howard, LSS and Star,
historically operated with fiscal years ending on dates other than June 30. For
purposes of the table below, their operating results have been recast to reflect
a June 30 fiscal year end, although they have been derived from financial
statements prepared on the same basis as the audited financial statements. As a
result of this presentation, the operating results for these three companies do
not conform with their audited financial statements contained elsewhere in this
Prospectus.

<TABLE>
<CAPTION>
FISCAL YEARS ENDED JUNE 30, THREE MONTHS ENDED SEPTEMBER 30,
------------------------------------------------------- -----------------------------------
1995 (1) 1996 1997 1996 1997
--------------- --------------- --------------- --------------- ---------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue............ $41,289 100.0% $51,497 100.0% $61,245 100.0% $14,291 100.0% $16,319 100.0%
Cost of revenue.... 17,770 43.0 22,205 43.1 26,117 42.6 5,707 39.9 7,000 42.9
------- ----- ------- ----- ------- ----- ------- ----- ------- -----
Gross profit....... $23,519 57.0% $29,292 56.9% $35,128 57.4% $ 8,584 60.1% $ 9,319 57.1%
======= ===== ======= ===== ======= ===== ======= ===== ======= =====
</TABLE>

- ---------------
(1) Includes 1995 data for LSS for the 12 months ended August 31, 1995.

24
<PAGE> 26

COMBINED RESULTS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1998
PERIOD") COMPARED TO THE THREE MONTHS ENDED SEPTEMBER 30, 1996 (THE "1997
PERIOD")

Revenue. Revenue increased $2.0 million, or 14.2%, from $14.3 million in
the 1997 Period to $16.3 million in the 1998 Period. This increase primarily was
attributable to increased revenues of Star and Decker.

Cost of Revenue. Cost of revenue increased $1.3 million, or 22.7%, from
$5.7 million in the 1997 Period to $7.0 million in the 1998 Period. As a
percentage of revenue, cost of revenue increased from 39.9% in the 1997 Period
to 42.9% in the 1998 Period, primarily due to increased cost of revenue of Star
and LSS.

COMBINED RESULTS FOR 1997 COMPARED TO 1996

Revenue. Revenue increased $9.7 million, or 18.9%, from $51.5 million in
1996 to $61.2 million in 1997. This increase primarily was attributable to
increased revenues of Star, BTI, LSS and MOHR.

Cost of Revenue. Cost of revenue increased $3.9 million, or 17.6%, from
$22.2 million in 1996 to $26.1 million in 1997. As a percentage of revenue, cost
of revenue decreased from 43.1% in 1996 to 42.6% in 1997, primarily due to
improved gross profit margins of BTI, Decker and LSS.

COMBINED RESULTS FOR 1996 COMPARED TO 1995

Revenue. Revenue increased $10.2 million, or 24.7%, from $41.3 million in
1995 to $51.5 million in 1996. This increase primarily was attributable to
increased revenues of Star, J. Howard, BTI and Novations.

Cost of Revenue. Cost of revenue increased approximately $4.4 million, or
25.0%, from $17.8 million in 1995 to $22.2 million in 1996. As a percentage of
revenue, cost of revenue increased slightly from 43.0% in 1995 to 43.1% in 1996,
primarily due to increased cost of revenue of MOHR, Decker and LSS.

COMBINED LIQUIDITY AND CAPITAL RESOURCES

After the consummation of the Combination and the Offering, the Company
will have approximately $2.7 million in cash and approximately $1.6 million of
indebtedness outstanding. The Company anticipates that its cash flow from
operations will provide cash sufficient to satisfy the Company's working capital
needs, debt service requirements and planned capital expenditures for the next
12 months. The Company made capital expenditures of approximately $903,000 in
1997 and approximately $363,000 in the three months ended September 30, 1997 and
currently intends to make capital expenditures of $1.0 million in fiscal 1998,
principally for information systems, facilities, furnishings and equipment.
After the Combination, the Company intends to study the feasibility of upgrading
and integrating certain systems of the Founding Companies. Consequently, the
Company has not yet established its capital needs for such integration and
upgrades. The Company has assessed its various information and technology
systems and does not believe that it will be required to incur significant costs
to correct any Year 2000 deficiencies. To the extent that the Company is
incorrect in this assessment and significant costs will be incurred, the
Company's business, financial condition and results of operations could be
materially adversely affected.

The Company intends to pursue selected acquisition opportunities. The
timing, size or success of any acquisition and the associated potential capital
commitments are unpredictable. The Company expects to fund future acquisitions
primarily through a combination of cash flow from operations and borrowings, as
well as issuances of additional equity. The Company plans to register an
additional 3,000,000 shares of its Common Stock under the Securities Act after
completion of the Offering for use as consideration for future acquisitions.

RESULTS OF OPERATIONS -- BTI

BTI primarily provides train-the-trainer programs designed to help its
clients improve employee selection and to provide managers with a methodology
for assessing strengths and weaknesses of current employees. BTI's revenue is
derived primarily from the licensing to clients of the right to use its training
materials.

25
<PAGE> 27

The following table sets forth certain selected financial data for BTI on a
historical basis and as a percentage of revenue for the periods indicated:

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, THREE MONTHS ENDED SEPTEMBER 30,
---------------------------------------------------- ---------------------------------
1995 1996 1997 1996 1997
-------------- -------------- -------------- -------------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue................. $3,803 100.0% $5,685 100.0% $7,096 100.0% $1,712 100.0% $1,977 100.0%
Cost of revenue......... 1,049 27.6 1,495 26.3 1,488 21.0 387 22.6 385 19.5
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Gross profit............ 2,754 72.4 4,190 73.7 5,608 79.0 1,325 77.4 1,592 80.5
Selling, general and
administrative
expenses.............. 2,315 60.9 4,048 71.2 5,111 72.0 969 56.6 1,306 66.0
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Income from
operations............ $ 439 11.5% $ 142 2.5% $ 497 7.0% $ 356 20.8% $ 286 14.5%
====== ===== ====== ===== ====== ===== ====== ===== ====== =====
Compensation
Differential.......... $ (89) (2.3)% $ 563 9.9% $ 942 13.3% $ 0 0% $ 337 17.0%
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1998 PERIOD") COMPARED TO THREE
MONTHS ENDED SEPTEMBER 30, 1996 (THE "1997 PERIOD") -- BTI

Revenue. Revenue increased $265,000, or 15.5%, from $1.7 million in the
1997 Period to $2.0 million in the 1998 Period, primarily due to increased sales
of existing products as a result of the expansion of the sales force and an
increase in participant fees as a result of an increased base of certified
trainers at the company's clients.

Cost of Revenue. Cost of revenue remained relatively constant, decreasing
from $387,000 in the 1997 Period to $385,000 in the 1998 Period. As a percentage
of revenue, cost of revenue decreased from 22.6% in the 1997 Period to 19.5% in
the 1998 Period, primarily due to a decrease in the average unit cost of
participant materials.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $337,000, or 34.8%, from
approximately $969,000 in the 1997 Period to $1.3 million in the 1998 Period.
Excluding the Compensation Differential of approximately $337,000 attributable
to BTI in the 1998 Period (there being no Compensation Differential for the 1997
Period), selling, general and administrative expenses would have remained
relatively constant at $1.0 million in the 1997 Period and the 1998 Period. As a
percentage of revenue, selling, general and administrative expenses would have
decreased on an adjusted basis from 56.6% in the 1997 Period to 49.0% in the
1998 Period, primarily due to the company's larger revenue base.

RESULTS FOR 1997 COMPARED TO 1996 -- BTI

Revenue. Revenue increased $1.4 million, or 24.8%, from $5.7 million in
1996 to $7.1 million in 1997, primarily due to increased sales of existing
products as a result of the expansion of the sales force and an increase in
participant fees as a result of an increased base of certified trainers at the
company's clients.

Cost of Revenue. Cost of revenue remained relatively constant at $1.5
million in 1996 and 1997. As a percentage of revenue, cost of revenue decreased
from 26.3% in 1996 to 21.0% in 1997, primarily due to a decrease in the average
unit cost of participant materials.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased $1.1 million, or 26.3%, from $4.0 million in
1996 to $5.1 million in 1997. Excluding the Compensation Differential
attributable to BTI of approximately $563,000 and approximately $942,000 in 1996
and 1997, respectively, selling, general and administrative expenses would have
increased approximately $684,000, or 19.6%, from $3.5 million in 1996 to $4.2
million in 1997. As a percentage of revenue, selling, general and administrative
expenses would have decreased on an adjusted basis from 61.3% in 1996 to 58.8%
in 1997. The decrease as a percentage of revenue on an adjusted basis primarily
was due to the company's larger revenue base.

26
<PAGE> 28

RESULTS FOR 1996 COMPARED TO 1995 -- BTI

Revenue. Revenue increased $1.9 million, or 49.5%, from $3.8 million in
1995 to $5.7 million in 1996, primarily due to increased sales of existing
products as a result of the expansion of the sales force and an increase in
participant fees as a result of an increased base of certified trainers at the
company's clients.

Cost of Revenue. Cost of revenue increased approximately $446,000, or
42.5%, from $1.0 million in 1995 to $1.5 million in 1996. As a percentage of
revenue, cost of revenue decreased slightly from 27.6% in 1995 to 26.3% in 1996.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased $1.7 million, or 74.9%, from $2.3 million in
1995 to $4.0 million in 1996. Excluding the Compensation Differential
attributable to BTI of approximately $(89,000) and approximately $563,000 in
1995 and 1996, selling, general and administrative expenses would have increased
$1.1 million, or 45.0%, from $2.4 million in 1995 to $3.5 million in 1996. As a
percentage of revenue, selling, general and administrative expenses would have
decreased slightly on an adjusted basis from 63.2% in 1995 to 61.3% in 1996.

LIQUIDITY AND CAPITAL RESOURCES -- BTI

BTI generated net cash from operating activities of approximately $641,000
in 1997. In the 1998 Period, BTI used approximately $63,000 in operating
activities, primarily due to an increase in accounts receivable. Net cash used
in investing activities was approximately $33,000 in 1997 and approximately
$3,000 in the 1998 Period for purchases of property and equipment. At September
30, 1997, BTI had working capital of $2.1 million.

RESULTS OF OPERATIONS -- DECKER

Decker provides instructor-led training to businesses to improve employees'
business communication skills and communications between management and
employees. Decker's revenue is derived primarily from fees charged to
participants in its instructor-led training programs.

The following table sets forth certain selected financial data for Decker
on a historical basis and as a percentage of revenue for the periods indicated:

<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, THREE MONTHS ENDED SEPTEMBER 30,
---------------------------------------------------- ---------------------------------
1995 1996 1997 1996 1997
-------------- -------------- -------------- -------------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue................. $8,550 100.0% $8,620 100.0% $8,410 100.0% $1,930 100.0% $2,585 100.0%
Cost of revenue......... 2,419 28.3 2,655 30.8 2,275 27.1 549 28.4 660 25.5
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Gross profit............ 6,131 71.7 5,965 69.2 6,135 72.9 1,381 71.6 1,925 74.5
Selling, general and
administrative
expenses.............. 5,670 66.3 5,716 66.3 5,621 66.8 1,261 65.4 1,663 64.4
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Income from
operations............ $ 461 5.4% $ 249 2.9% $ 514 6.1% $ 120 6.2% $ 262 10.1%
====== ===== ====== ===== ====== ===== ====== ===== ====== =====
Compensation
Differential.......... $ 192 2.2% $ 192 2.2% $ 340 4.0% $ 60 3.1% $ 110 4.3%
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1998 PERIOD") COMPARED TO THREE
MONTHS ENDED SEPTEMBER 30, 1996 (THE "1997 PERIOD") -- DECKER

Revenue. Revenue increased approximately $655,000, or 33.9%, from $1.9
million in the 1997 Period to $2.6 million in the 1998 Period, primarily due to
an increase in the sales force and organizational initiatives undertaken in 1997
as described below, which resulted in an increase in the number of seminars
delivered during the 1998 Period.

Cost of Revenue. Cost of revenue increased approximately $111,000, or
20.2%, from approximately $549,000 in the 1997 Period to approximately $660,000
in the 1998 Period. As a percentage of revenue, cost of revenue decreased from
28.4% in the 1997 Period to 25.5% in the 1998 Period, primarily due to the
increased utilization of trainers for instructor-led programs.

27
<PAGE> 29

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $402,000, or 31.9%, from $1.3
million in the 1997 Period to $1.7 million in the 1998 Period. Excluding the
Compensation Differential of approximately $60,000 and approximately $110,000
attributable to Decker in the 1997 Period and 1998 Period, respectively,
selling, general and administrative expenses would have increased approximately
$352,000, or 29.3%, from $1.2 million in the 1997 Period to $1.6 million in the
1998 Period. As a percentage of revenue, selling, general and administrative
expenses would have decreased on an adjusted basis from 62.2% in the 1997 Period
to 60.1% in the 1998 Period, primarily due to the company's larger revenue base.

RESULTS FOR 1997 COMPARED TO 1996 -- DECKER

Revenue. Revenue decreased approximately $210,000, or 2.4%, from $8.6
million in 1996 to $8.4 million in 1997, primarily due to a temporary shift in
the focus of Decker's business. During the first six months of 1997, Decker
increased its focus on providing consulting services rather than its traditional
training. This shift in focus resulted in a decline in training revenue and a
high degree of sales force turnover. During the second half of 1997, the company
returned to a business model focused on instructor-led training, and launched
several organizational initiatives, including the hiring of a new president and
the implementation of a new salary structure for its sales force.

Cost of Revenue. Cost of revenue decreased approximately $380,000, or
14.4%, from $2.7 million in 1996 to $2.3 million in 1997. As a percentage of
revenue, cost of revenue decreased from 30.8% in 1996 to 27.1% in 1997,
primarily due to a reduction in the number of trainers and increased utilization
of trainers.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses decreased approximately $95,000, or 1.7%, from $5.7
million in 1996 to $5.6 million in 1997. Excluding the Compensation Differential
attributable to Decker of approximately $192,000 and approximately $340,000 in
1996 and 1997, respectively, selling, general and administrative expenses would
have decreased approximately $243,000, or 4.4%, from $5.5 million in 1996 to
$5.3 million in 1997. As a percentage of revenue, selling, general and
administrative expenses would have decreased on an adjusted basis from 64.1% in
1996 to 62.8% in 1997.

RESULTS FOR 1996 COMPARED TO 1995 -- DECKER

Revenue. Revenue increased approximately $70,000, or 0.8%, from $8.5
million in 1995 to $8.6 million in 1996.

Cost of Revenue. Cost of revenue increased approximately $236,000, or
9.8%, from $2.4 million in 1995 to $2.7 million in 1996. As a percentage of
revenue, cost of revenue increased from 28.3% in 1995 to 30.8% in 1996,
primarily due to higher salaries paid to the company's trainers in 1996.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses remained relatively constant at $5.7 million 1995 and
1996. Excluding the Compensation Differential attributable to Decker of
approximately $192,000 in both 1995 and 1996, selling, general and
administrative expenses would have remained relatively constant at $5.5 million
in 1995 and 1996. As a percentage of revenue, selling, general and
administrative expenses would have remained constant on an adjusted basis at
64.1% in 1995 and 1996.

LIQUIDITY AND CAPITAL RESOURCES -- DECKER

Decker generated net cash from operating activities of approximately
$446,000 in 1997 and $496,000 in the 1998 Period. Net cash used in investing
activities was approximately $11,000 in 1997, primarily for purchases of
property and equipment, and approximately $464,000 in the 1998 Period, primarily
for the purchase of marketable securities. Net cash used in financing activities
was approximately $241,000 in 1997, primarily for the payment of dividends, and
approximately $14,000 in the 1998 Period for payments on notes payable. At
September 30, 1997, Decker had working capital of $1.1 million and approximately
$1.0 million of long-term debt.

28
<PAGE> 30

RESULTS OF OPERATIONS -- J. HOWARD

J. Howard provides instructor-led training to individual managers and
client companies to identify and address potential obstacles to improving
workplace productivity, including race and gender issues, sexual harassment and
failure of employees to take measured risks. J. Howard's revenue is derived
primarily from fees from instructor-led seminars and, to a lesser extent, from
the rendering of consulting services. J. Howard also occasionally enters into
license agreements and then delivers its programs in the train-the-trainer
format; in these instances, revenue from the license agreements is recognized
when the license is signed. Revenue from the trainer certifications is
recognized on a per event basis when the training is delivered.

The following table sets forth certain selected financial data for J.
Howard on a historical basis and as a percentage of revenue for the periods
indicated:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, NINE MONTHS ENDED SEPTEMBER 30,
---------------------------------------------------- ---------------------------------
1994 1995 1996 1996 1997
-------------- -------------- -------------- -------------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue................. $5,087 100.0% $6,251 100.0% $7,110 100.0% $5,814 100.0% $6,077 100.0%
Cost of revenue......... 1,713 33.7 1,964 31.4 2,166 30.5 1,782 30.7 1,851 30.5
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Gross profit............ 3,374 66.3 4,287 68.6 4,944 69.5 4,032 69.3 4,226 69.5
Selling, general and
administrative
expenses.............. 3,087 60.7 4,158 66.5 4,559 64.1 2,791 48.0 3,170 52.1
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Income from
operations............ $ 287 5.6% $ 129 2.1% $ 385 5.4% $1,241 21.3% $1,056 17.4%
====== ===== ====== ===== ====== ===== ====== ===== ====== =====
Compensation
Differential.......... $ 172 3.4% $ 522 8.4% $ 944 13.3% $ 177 3.0% $ 305 5.0%
</TABLE>

NINE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1997 PERIOD") COMPARED TO NINE MONTHS
ENDED SEPTEMBER 30, 1996 (THE "1996 PERIOD") -- J. HOWARD

Revenue. Revenue increased approximately $263,000, or 4.5%, from $5.8
million in the 1996 Period to $6.1 million in the 1997 Period, primarily due to
increased license revenue generated from one of the company's clients during the
1997 Period.

Cost of Revenue. Cost of revenue increased approximately $69,000, or 3.9%,
from $1.8 million in the 1996 Period to $1.9 million in the 1997 Period. As a
percentage of revenue, cost of revenue decreased slightly from 30.7% in the 1996
Period to 30.5% in the 1997 Period.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $379,000, or 13.6%, from $2.8
million in the 1996 Period to $3.2 million in the 1997 Period. Excluding the
Compensation Differential of approximately $177,000 and approximately $305,000
attributable to J. Howard in the 1996 Period and 1997 Period, respectively,
selling, general and administrative expenses would have increased approximately
$251,000, or 9.6%, from $2.6 million in the 1996 Period to $2.9 million in the
1997 Period. As a percentage of revenue, selling, general and administrative
expenses would have increased on an adjusted basis from 45.0% in the 1996 Period
to 47.1% in the 1997 Period, primarily due to compensation paid to additional
salespeople hired during the 1997 calendar year who did not generate material
revenue during the 1997 Period.

RESULTS FOR THE YEAR ENDED DECEMBER 31, 1996 COMPARED TO THE YEAR ENDED DECEMBER
31, 1995 -- J. HOWARD

Revenue. Revenue increased approximately $859,000, or 13.7%, from $6.3
million in the year ended December 31, 1995 to $7.1 million in the year ended
December 31, 1996, primarily due to a general increase in the number of client
engagements.

Cost of Revenue. Cost of revenue increased approximately $202,000, or
10.3%, from $2.0 million in the year ended December 31, 1995 to $2.2 million in
the year ended December 31, 1996. As a percentage of revenue, cost of revenue
decreased slightly from 31.4% in the year ended December 31, 1995 to 30.5% in
the year ended December 31, 1996.

29
<PAGE> 31

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $401,000, or 9.6%, from $4.2
million in the year ended December 31, 1995 to $4.6 million in the year ended
December 31, 1996. Excluding the Compensation Differential attributable to J.
Howard of approximately $522,000 and approximately $944,000 in the year ended
December 31, 1995 and the year ended December 31, 1996, respectively, selling,
general and administrative expenses would have remained relatively constant at
$3.6 million. As a percentage of revenue, selling, general and administrative
expenses would have decreased on an adjusted basis from 58.2% in the year ended
December 31, 1995 to 50.8% in the year ended December 31, 1996.

RESULTS FOR THE YEAR ENDED DECEMBER 31, 1995 COMPARED TO THE YEAR ENDED DECEMBER
31, 1994 -- J. HOWARD

Revenue. Revenue increased $1.2 million, or 22.9%, from $5.1 million in
the year ended December 31, 1994 to $6.3 million in the year ended December 31,
1995, primarily due to the expansion of two existing client relationships in the
1995 calendar year to include licensing and trainer certifications.

Cost of Revenue. Cost of revenue increased approximately $251,000, or
14.7%, from $1.7 million in the year ended December 31, 1994 to $2.0 million in
the year ended December 31, 1995. As a percentage of revenue, cost of revenue
decreased from 33.7% in the year ended December 31, 1994 to 31.4% in the year
ended December 31, 1995.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased $1.1 million, or 34.7%, from $3.1 million in
the year ended December 31, 1994 to $4.2 million in the year ended December 31,
1995. Excluding the Compensation Differential attributable to J. Howard of
approximately $172,000 and approximately $522,000 in the year ended December 31,
1994 and the year ended December 31, 1995, respectively, selling, general and
administrative expenses would have increased approximately $721,000, or 24.7%,
from $2.9 million in the year ended December 31, 1994 to $3.6 million in the
year ended December 31, 1995. As a percentage of revenue, selling, general and
administrative expenses would have increased slightly on an adjusted basis from
57.3% in the year ended December 31, 1994 to 58.2% in the year ended December
31, 1995.

LIQUIDITY AND CAPITAL RESOURCES -- J. HOWARD

J. Howard generated net cash from operating activities of approximately
$464,000 in the year ended December 31, 1996 and approximately $715,000 in the
1997 Period. Net cash used in investing activities was approximately $248,000 in
the year ended December 31, 1996 and approximately $105,000 in the 1997 Period,
primarily for purchases of property and equipment. Net cash used in financing
activities was approximately $481,000 in the year ended December 31, 1996 for
distributions to stockholders. At September 30, 1997, J. Howard had working
capital of $1.8 million.

RESULTS OF OPERATIONS -- LSS

LSS creates customized training products that generally are designed to
facilitate faster learning of customer interface devices and higher productivity
of retail associates. LSS's training products are delivered to clients primarily
through interactive multimedia software and, to a lesser extent, distance-based
media. LSS derives revenue from the design, development and delivery of its
products.

30
<PAGE> 32

The following table sets forth certain selected financial data for LSS on a
historical basis and as a percentage of revenue for the periods indicated:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, NINE MONTHS ENDED SEPTEMBER 30,
--------------------------------- ---------------------------------
1995 1996 1996 1997
-------------- -------------- -------------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue....................... $3,332 100.0% $5,123 100.0% $3,570 100.0% $3,960 100.0%
Cost of revenue............... 1,390 41.7 1,696 33.1 1,230 34.5 1,590 40.2
------ ----- ------ ----- ------ ----- ------ -----
Gross profit.................. 1,942 58.3 3,427 66.9 2,340 65.5 2,370 59.8
Selling, general and
administrative expenses..... 1,767 53.0 3,079 60.1 1,713 47.9 1,697 42.8
------ ----- ------ ----- ------ ----- ------ -----
Income from operations........ $ 175 5.3% $ 348 6.8% $ 627 17.6% $ 673 17.0%
====== ===== ====== ===== ====== ===== ====== =====
Compensation Differential..... $ 415 12.5% $1,379 26.9% $ 484 13.6% $ 333 8.4%
</TABLE>

NINE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1997 PERIOD") COMPARED TO NINE MONTHS
ENDED SEPTEMBER 30, 1996 (THE "1996 PERIOD") -- LSS

Revenue. Revenue increased approximately $390,000, or 10.9%, from $3.6
million in the 1996 Period to $4.0 million in the 1997 Period, primarily due to
the expansion of the sales force.

Cost of Revenue. Cost of revenue increased approximately $360,000, or
29.3%, from $1.2 million in the 1996 Period to $1.6 million in the 1997 Period.
As a percentage of revenue, cost of revenue increased from 34.5% in the 1996
Period to 40.2% in the 1997 Period, primarily due to increased video production
costs associated with certain of the company's products during the 1997 Period,
which generally result in lower gross margins.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses remained relatively constant at $1.7 million in the 1996
Period and the 1997 Period. Excluding the Compensation Differential of
approximately $484,000 and approximately $333,000 attributable to LSS in the
1996 Period and 1997 Period, respectively, selling, general and administrative
expenses would have increased approximately $135,000, or 11.0%, from $1.2
million in the 1996 Period to $1.4 million in the 1997 Period. As a percentage
of revenue, selling, general and administrative expenses would have remained
constant on an adjusted basis at approximately 34.4% in the 1996 Period and the
1997 Period.

RESULTS FOR THE YEAR ENDED DECEMBER 31, 1996 COMPARED TO THE YEAR ENDED DECEMBER
31, 1995 -- LSS

Revenue. Revenue increased $1.8 million, or 53.8%, from $3.3 million in
the year ended December 31, 1995 to $5.1 million in the year ended December 31,
1996, primarily due to the increased productivity from the company's expanded
sales force.

Cost of Revenue. Cost of revenue increased approximately $306,000, or
22.0%, from $1.4 million in the year ended December 31, 1995 to $1.7 million in
the year ended December 31, 1996. As a percentage of revenue, cost of revenue
decreased from 41.7% in the year ended December 31, 1995 to 33.1% in the year
ended December 31, 1996, primarily due to several follow-on client engagements
which generally result in lower production costs.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased $1.3 million, or 74.3%, from $1.8 million in
the year ended December 31, 1995 to $3.1 million in the year ended December 31,
1996. Excluding the Compensation Differential attributable to LSS of
approximately $415,000 and $1.4 million in the year ended December 31, 1995 and
the year ended December 31, 1996, respectively, selling, general and
administrative expenses would have increased approximately $348,000, or 25.7%,
from $1.4 million in the year ended December 31, 1995 to $1.7 million in the
year ended December 31, 1996. As a percentage of revenue, selling, general and
administrative expenses would have decreased on an adjusted basis from 40.6% in
the year ended December 31, 1995 to 33.2% in the year ended December 31, 1996,
primarily due to the company's larger revenue base.

31
<PAGE> 33

LIQUIDITY AND CAPITAL RESOURCES -- LSS

LSS generated net cash from operating activities of approximately $315,000
in the year ended December 31, 1996 and approximately $295,000 in the 1997
Period. Net cash used in investing activities was approximately $85,000 in the
year ended December 31, 1996 and approximately $61,000 in the 1997 Period for
purchases of property and equipment. At September 30, 1997, LSS had working
capital of approximately $887,000.

RESULTS OF OPERATIONS -- MOHR

MOHR offers train-the-trainer seminars to help clients in the retail
industry primarily to improve productivity by fostering a customer-oriented
focus at the sales management and sales associate levels. In some of its
programs, MOHR trains employees directly through instructor-led seminars. MOHR's
revenue is derived primarily from the licensing to clients of the right to use
its training programs on a participant or site basis.

The following table sets forth certain selected financial data for MOHR on
a historical basis and as a percentage of revenue for the periods indicated:

<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER
YEAR ENDED JUNE 30, 30,
--------------------------------- ------------------------------
1996 1997 1996 1997
-------------- -------------- ------------ -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue......................... $2,171 100.0% $3,015 100.0% $554 100.0% $ 556 100.0%
Cost of revenue................. 677 31.2 825 27.4 187 33.8 204 36.7
------ ----- ------ ----- ---- ----- ----- -----
Gross profit.................... 1,494 68.8 2,190 72.6 367 66.2 352 63.3
Selling, general and
administrative expenses....... 1,151 53.0 1,745 57.9 383 69.1 562 101.1
------ ----- ------ ----- ---- ----- ----- -----
Income (loss) from operations... $ 343 15.8% $ 445 14.7% $(16) (2.9)% $(210) (37.8)%
====== ===== ====== ===== ==== ===== ===== =====
Compensation Differential....... $ 144 6.6% $ 334 11.1% $ 60 10.8% $ 105 18.9%
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1998 PERIOD") COMPARED TO THREE
MONTHS ENDED SEPTEMBER 30, 1996 (THE "1997 PERIOD") -- MOHR

Revenue. Revenue increased slightly, from approximately $554,000 in the
1997 Period to approximately $556,000 in the 1998 Period.

Cost of Revenue. Cost of revenue increased approximately $17,000, or 9.1%,
from approximately $187,000 in the 1997 Period to approximately $204,000 in the
1998 Period. As a percentage of revenue, cost of revenue increased from 33.8% in
the 1997 Period to 36.7% in the 1998 Period.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $179,000, or 46.7%, from
approximately $383,000 in the 1997 Period to approximately $562,000 in the 1998
Period. Excluding the Compensation Differential of approximately $60,000 and
approximately $105,000 attributable to MOHR in the 1997 Period and 1998 Period,
respectively, selling, general and administrative expenses would have increased
approximately $134,000, or 41.5%, from approximately $323,000 in the 1997 Period
to approximately $457,000 in the 1998 Period. As a percentage of revenue,
selling, general and administrative expenses would have increased on an adjusted
basis from 58.3% in the 1997 Period to 82.2% in the 1998 Period, primarily due
to compensation paid to additional salespeople hired during 1997 who did not
generate material revenue during the 1998 Period and development costs incurred
to update certain of the company's products.

RESULTS FOR 1997 COMPARED TO 1996 -- MOHR

Revenue. Revenue increased approximately $844,000, or 38.9%, from $2.2
million in 1996 to $3.0 million in 1997, primarily due to the hiring of two
additional salespeople and the increase in license fees during 1997.

32
<PAGE> 34

Cost of Revenue. Cost of revenue increased approximately $148,000, or
21.9%, from approximately $677,000 in 1996 to approximately $825,000 in 1997. As
a percentage of revenue, cost of revenue decreased from 31.2% in 1996 to 27.4%
in 1997, primarily due to the increase in license fees, which result in higher
margins than train-the-trainer seminars.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $594,000, or 51.6%, from $1.2
million in 1996 to $1.8 million in 1997. Excluding the Compensation Differential
attributable to MOHR of approximately $144,000 and approximately $334,000 in
1996 and 1997, respectively, selling, general and administrative expenses would
have increased approximately $404,000, or 40.1%, from $1.0 million in 1996 to
$1.4 million in 1997. As a percentage of revenue, selling, general and
administrative expenses would have increased slightly from 46.4% in 1996 to
46.8% in 1997.

LIQUIDITY AND CAPITAL RESOURCES -- MOHR

MOHR generated net cash from operating activities of approximately $80,000
in 1997. In the 1998 Period, MOHR used approximately $43,000 in operating
activities. Net cash used in investing activities was approximately $41,000 in
1997 and approximately $6,000 in the 1998 Period for purchases of property and
equipment. At September 30, 1997, MOHR had working capital of approximately
$249,000.

RESULTS OF OPERATIONS -- NOVATIONS

Novations assists clients in, among other things, clarifying and
communicating their business strategies and re-designing their organizations and
work systems. Novations also provides its clients with a variety of
organizational assessment tools that are designed to gather and analyze feedback
on either an organizational or individual basis and to initiate change within
the client's organization in response to such feedback. Novations' revenue is
derived primarily from fees from professional services and, to a lesser extent,
from the sale of services and products to support human resource management.

The following table sets forth certain selected financial data for
Novations on a historical basis and as a percentage of revenue for the periods
indicated:

<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER
YEAR ENDED JUNE 30, 30,
----------------------------------------------- ------------------------------
1995 1996 1997 1996 1997
------------- ------------- ------------- ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue.................. $7,175 100.0% $9,039 100.0% $9,018 100.0% $2,167 100.0% $2,464 100.0%
Cost of revenue.......... 3,885 54.1 4,733 52.4 4,839 53.7 1,117 51.5 1,197 48.6
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Gross profit............. 3,290 45.9 4,306 47.6 4,179 46.3 1,050 48.5 1,267 51.4
Selling, general and
administrative
expenses............... 3,167 44.2 4,094 45.3 3,315 36.7 823 38.0 1,088 44.1
------ ----- ------ ----- ------ ----- ------ ----- ------ -----
Income from operations... $ 123 1.7% $ 212 2.3% $ 864 9.6% $ 227 10.5% $ 179 7.3%
====== ===== ====== ===== ====== ===== ====== ===== ====== =====
Compensation
Differential........... $1,208 16.8% $1,471 16.3% $ 661 7.3% $ 174 8.0% $ 375 15.2%
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1998 PERIOD") COMPARED TO THREE
MONTHS ENDED SEPTEMBER 30, 1996 (THE "1997 PERIOD") -- NOVATIONS

Revenue. Revenue increased approximately $297,000, or 13.7%, from $2.2
million in the 1997 Period to $2.5 million in the 1998 Period, primarily due to
an increase in organizational assessment revenues of $213,000 in the 1998
Period.

Cost of Revenue. Cost of revenue increased approximately $80,000, or 7.2%
from $1.1 million in the 1997 Period to $1.2 million in the 1998 Period. As a
percentage of revenue, cost of revenue decreased from 51.5% in the 1997 Period
to 48.6% in the 1998 Period, primarily due to the increased utilization of the
company's consultants.

33
<PAGE> 35

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $265,000, or 32.2%, from
approximately $823,000 in the 1997 Period to $1.1 million in the 1998 Period.
Excluding the Compensation Differential attributable to Novations of
approximately $174,000 and approximately $375,000 in the 1997 Period and 1998
Period, respectively, selling, general and administrative expenses would have
increased $64,000, or 9.9%, from approximately $649,000 in the 1997 Period to
approximately $713,000 in the 1998 Period. As a percentage of revenue, selling,
general and administrative expenses would have decreased on an adjusted basis
from 29.9% in the 1997 Period to 28.9% in the 1998 Period.

RESULTS FOR 1997 COMPARED TO 1996 -- NOVATIONS

Revenue. Revenue remained relatively constant at $9.0 million in 1996 and
1997.

Cost of Revenue. Cost of revenue increased approximately $106,000, or
2.2%, from $4.7 million in 1996 to $4.8 million in 1997. As a percentage of
revenue, cost of revenue increased from 52.4% in 1996 to 53.7% in 1997,
primarily due to an increase in the size of the consulting staff.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses decreased by $779,000 or 19.0%, from $4.1 million in
1996 to $3.3 million in 1997. Excluding the Compensation Differential
attributable to Novations of $1.5 million and approximately $661,000 in 1996 and
1997, respectively, selling, general and administrative expenses would have
increased approximately $31,000, or 1.2%, from $2.6 million in 1996 to $2.7
million in 1997. As a percentage of revenue, selling, general and administrative
expenses would have increased slightly on an adjusted basis from 29.0% in 1996
to 29.4% in 1997.

RESULTS FOR 1996 COMPARED TO 1995 -- NOVATIONS

Revenue. Revenue increased $1.9 million, or 26.0%, from $7.2 million in
1995 to $9.0 million in 1996, primarily due to the introduction and marketing of
new services and the hiring of additional consultants.

Cost of Revenue. Cost of revenue increased approximately $848,000, or
21.8%, from $3.9 million in 1995 to $4.7 million in 1996. As a percentage of
revenue, cost of revenue decreased slightly from 54.1% in 1995 to 52.4% in 1996.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased approximately $927,000, or 29.3% from $3.2
million in 1995 to $4.1 million in 1996. Excluding the Compensation Differential
attributable to Novations of $1.2 million and $1.5 million in 1995 and 1996,
respectively, selling, general and administrative expenses would have increased
approximately $664,000, or 33.9%, from $2.0 million in 1995 to $2.6 million in
1996. As a percentage of revenue, selling, general and administrative expenses
would have increased on an adjusted basis from 27.3% in 1995 to 29.0%, primarily
due to an expansion of the company's infrastructure to support revenue growth.

LIQUIDITY AND CAPITAL RESOURCES -- NOVATIONS

Novations generated net cash from operating activities of approximately
$153,000 in 1997 and $587,000 in the 1998 Period. Net cash used in investing
activities was approximately $137,000 and $9,000 in 1997 and the 1998 Period,
respectively, for purchases of property and equipment. Net cash provided by
financing activities was approximately $55,000 in 1997, from net proceeds of
long-term debt partially offset by distributions to stockholders. Net cash used
in financing activities was approximately $220,000 in the 1998 Period, for the
repayment of notes payable. At September 30, 1997, Novations had working capital
of approximately $544,000 and approximately $361,000 of long term debt.

RESULTS OF OPERATIONS -- STAR

Star provides customized training and development services and products to
train individuals primarily within agencies of federal, state and local
government. Star delivers its courseware to clients in a variety of formats
(including written materials and interactive multimedia software), but typically
does not directly train

34
<PAGE> 36

its clients. Star's revenue is derived primarily from fees received from the
provision of training services as a contractor or subcontractor under government
contracts.

The following table sets forth certain selected financial data for Star on
a historical basis and as a percentage of revenue for the periods indicated:

<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
YEAR ENDED DECEMBER 31,
------------------------------------------------- --------------------------------
1994 1995 1996 1996 1997
------------- -------------- -------------- -------------- --------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue.............. $9,731 100.0% $14,306 100.0% $16,313 100.0% $11,785 100.0% $17,101 100.0%
Cost of revenue...... 6,350 65.3 8,668 60.6 9,457 58.0 6,559 55.7 10,588 61.9
------ ----- ------- ----- ------- ----- ------- ----- ------- -----
Gross profit......... 3,381 34.7 5,638 39.4 6,856 42.0 5,226 44.3 6,513 38.1
Selling, general and
administrative
expenses........... 3106 31.9 4,611 32.2 5,815 35.6 4,222 35.8 5,638 33.0
------ ----- ------- ----- ------- ----- ------- ----- ------- -----
Income from
operations......... $ 275 2.8% $ 1,027 7.2% $ 1,041 6.4% $ 1,004 8.5% $ 875 5.1%
====== ===== ======= ===== ======= ===== ======= ===== ======= =====
Compensation
Differential....... $ 36 0.4% $ 64 0.4% $ 304 1.9% $ 228 1.9% $ 135 0.8%
</TABLE>

NINE MONTHS ENDED SEPTEMBER 30, 1997 (THE "1997 PERIOD") COMPARED TO NINE MONTHS
ENDED SEPTEMBER 30, 1996 (THE "1996 PERIOD") -- STAR

Revenue. Revenue increased $5.3 million, or 45.1%, from $11.8 million in
the 1996 Period to $17.1 million in the 1997 Period, primarily due to an
increase in the number of federal government contracts undertaken, as well as
revenue of $3.4 million contributed by businesses acquired during the third
calendar quarter of 1996 and the first calendar quarter of 1997. Revenue was
significantly lower during the first half of the 1996 calendar year as a result
of a decline in new client engagements due to prolonged Congressional budget
negotiations.

Cost of Revenue. Cost of revenue increased approximately $4.0 million, or
61.4%, from $6.6 million in the 1996 Period to $10.6 million in the 1997 Period.
As a percentage of revenue, cost of revenue increased from 55.7% in the 1996
Period to 61.9% in the 1997 Period, primarily due to the increased use of
subcontractors during the 1997 Period.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased $1.4 million, or 33.5%, from $4.2 million in
the 1996 Period to $5.6 million in the 1997 Period. Excluding the Compensation
Differential of approximately $228,000 and approximately $135,000 attributable
to Star in the 1996 Period and 1997 Period, respectively, selling, general and
administrative expenses would have increased $1.5 million, or 37.8%, from $4.0
million in the 1996 Period to $5.5 million in the 1997 Period. As a percentage
of revenue, selling, general and administrative expenses would have decreased on
an adjusted basis from 33.9% in the 1996 Period to 32.2% in the 1997 Period,
primarily due to the company's larger revenue base.

RESULTS FOR THE YEAR ENDED DECEMBER 31, 1996 COMPARED TO THE YEAR ENDED DECEMBER
31, 1995 -- STAR

Revenue. Revenue increased $2.0 million, or 14.0%, from $14.3 million in
the year ended December 31, 1995 to $16.3 million in the year ended December 31,
1996, due to revenue of $3.6 million contributed by businesses acquired by Star
in the third calendar quarters of 1995 and 1996. The revenue from the acquired
businesses was offset partially by the decline in business generated from
federal government entities as a result of the Congressional budget negotiations
described above.

Cost of Revenue. Cost of revenue increased approximately $789,000, or
9.1%, from $8.7 million in the year ended December 31, 1995 to $9.5 million in
the year ended December 31, 1996. As a percentage of revenue, cost of revenue
decreased from 60.6% in the year ended December 31, 1995 to 58.0% in the year
ended December 31, 1996, primarily due to the acquisition in the third calendar
quarter of 1996 of a business with higher gross profit margins than Star's core
business.

35
<PAGE> 37

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased $1.2 million, or 26.1%, from $4.6 million in
the year ended December 31, 1995 to $5.8 million in the year ended December 31,
1996. Excluding the Compensation Differential attributable to Star of
approximately $64,000 and approximately $304,000 in the years ended December 31,
1995 and 1996, respectively, selling, general and administrative expenses would
have increased approximately $964,000, or 21.2%, from $4.5 million in the year
ended December 31, 1995 to $5.5 million in the year ended December 31, 1996. As
a percentage of revenue, selling, general and administrative expenses would have
increased on an adjusted basis from 31.8% in the year ended December 31, 1995 to
33.7% in the year ended December 31, 1996.

RESULTS FOR THE YEAR ENDED DECEMBER 31, 1995 COMPARED TO THE YEAR ENDED DECEMBER
31, 1994 -- STAR

Revenue. Revenue increased $4.6 million, or 47.0%, from $9.7 million in
the year ended December 31, 1994 to $14.3 million in the year ended December 31,
1995, primarily due to an increase in the number of projects undertaken during
the 1995 calendar year, and revenue of $1.0 million contributed by a business
acquired by Star in the third calendar quarter of 1995.

Cost of Revenue. Cost of revenue increased $2.3 million, or 36.5%, from
$6.4 million in the year ended December 31, 1994 to $8.7 million in the year
ended December 31, 1995. As a percentage of revenue, cost of revenue decreased
from 65.3% in the year ended December 31, 1994 to 60.6% in the year ended
December 31, 1995, primarily as a result of the acquisition of a business with
higher gross margin percentages than Star and the improvement in operating
results for Star's core business.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased $1.5 million, or 48.5%, from $3.1 million in
the year ended December 31, 1994 to $4.6 million in the year ended December 31,
1995. Excluding the Compensation Differential of approximately $36,000 and
approximately $64,000 attributable to Star in the years ended December 31, 1994
and 1995, respectively, selling, general and administrative expenses would have
increased $1.5 million, or 48.1%, from $3.1 million in the year ended December
31, 1994 to $4.5 million in the year ended December 31, 1995. As a percentage of
revenue, selling, general and administrative expenses would have increased
slightly on an adjusted basis from 31.5% in the year ended December 31, 1994 to
31.8% in the year ended December 31, 1995.

LIQUIDITY AND CAPITAL RESOURCES -- STAR

Star generated net cash from operating activities of $1.1 million in the
year ended December 31, 1996 and approximately $999,000 in the 1997 Period. Net
cash used in investing activities was approximately $565,000 in the year ended
December 31, 1996 and $1.1 million in the 1997 Period, primarily for
acquisitions. Net cash used in financing activities was approximately $478,000
in the year ended December 31, 1996, primarily for purchases of treasury stock.
Net cash provided by financing activities was approximately $360,000 in the 1997
Period, primarily from borrowings on the company's line of credit. At September
30, 1997, Star had working capital of approximately $287,000, and long-term debt
of approximately $379,000.

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<PAGE> 38

BUSINESS

COMPANY OVERVIEW

The Company provides a broad range of training and development services and
products to Fortune 1000 companies, other large and medium-sized corporations
and government entities. The Company's services and products are designed to
increase the productivity of organizations by improving employee selection,
recruitment and retention; enhancing employee work skills; developing employee
management and leadership skills; and facilitating organizational assessment,
direction and change. The Company offers both customized and off-the-shelf
services and products that are designed to provide measurable improvements in
employee performance and productivity. The Company delivers its services and
products through multiple delivery methods, including instructor-led classroom
training and seminars, certification of client employees as instructors
("train-the-trainer"), interactive multimedia software (such as CD-ROM) and
distance-based media (such as video conferencing, intranets and the Internet).
The seven Founding Companies are recognized leaders in their respective fields
and have developed a wide range of services and products, a substantial
knowledge base created from years of research and development, and a
well-established client base. The Company's objective is to become a leading
single source provider of high-quality training and development services and
products that are distributed through multiple delivery methods.

MARKET OVERVIEW

The corporate and government training and development market is large and
growing. According to Training Magazine, domestic corporations with over 100
employees budgeted approximately $58.6 billion on training in 1997, compared to
approximately $45.0 billion in 1992, representing a compound annual growth rate
of approximately 5.4%. The size of and growth in the federal government market
can be seen in the Department of Defense's training and development budget,
which for its 1997 fiscal year was approximately $23.9 billion, compared to
approximately $18.0 billion in its 1992 fiscal year, representing a compound
annual growth rate of approximately 5.8%. Provant believes that this growth has
been and will continue to be driven by: (i) the evolution from a
manufacturing-based to a service-based economy; (ii) the increasing recognition
by businesses that education, training and effective human resource management
are competitive necessities rather than optional expenses; and (iii) the
expanding use of technology throughout all levels of organizations, which has
increased the overall amount of training required and the number of employees
participating in such training.

Corporations and government entities increasingly are utilizing external
providers to meet their training and development needs. Expenditures on external
training and development by domestic corporations with over 100 employees have
increased from approximately $8.8 billion in 1992 to a budgeted $13.6 billion in
1997, representing a compound annual growth rate of 9.1%, and have increased as
a percentage of the total training budgets of such corporations from
approximately 19.6% in 1992 to 23.2% in 1997. The Company believes that federal
government expenditures on external training and development have increased from
approximately $600 million in the federal government's 1992 fiscal year to a
budgeted $3.8 billion in its 1997 fiscal year, representing a compound annual
growth rate of 44.7%. The Company believes that the growth in the external
training and development market has been driven by the desire of organizations
to: (i) focus on their core competencies; (ii) shift fixed training costs to
variable costs; and (iii) obtain training and development services, products,
technology and expertise that may not be available internally.

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<PAGE> 39

As a result of significant advances in computer and communications
technology, the training and development industry is experiencing rapid change
in the delivery of services and products. Historically, training and development
organizations delivered services and products primarily through instructor-led
seminars. Technological advances, however, now permit organizations to provide
training at distant and multiple locations as well as self-paced training,
allowing a far greater number of participants to learn conveniently and
efficiently. Interactive multimedia software (such as CD-ROM) and distance-based
learning media (such as video conferencing, intranets and the Internet) overcome
many of the cost and space constraints of traditional instructor-led training.
The Company believes that corporations increasingly are using technology-driven
alternatives due to their ability to: (i) increase learning and retention; (ii)
minimize the opportunity costs of time spent away from the job by employees;
(iii) provide access to training and development services and products "on
demand"; (iv) lower overall training and development costs, including travel
expenses of employees; and (v) measure and track employees' progress. Although
instructor-led training currently is the primary means of delivery of training
and development services and products, the Company believes that
technology-based delivery increasingly will be used to both supplement and, in
some cases, replace instructor-led training.

The training and development industry is highly fragmented, with no company
having more than a one percent share of the external training market. Many
companies in the industry provide a narrow range of services and products
through limited delivery methods. The Company believes that these companies
generally have made limited investments in content development, marketing and
the technology necessary to develop or utilize alternative delivery methods. As
corporations and government entities increasingly use external training
providers, the Company believes that they will seek providers that can meet
their overall training and development needs by: (i) providing a broad range of
high-quality services and products in both customized and off-the-shelf formats;
(ii) delivering training through multiple delivery methods capable of reaching
large and geographically dispersed work forces; and (iii) utilizing the most
current technology available. As a result, the Company believes that significant
opportunities are available for well-capitalized companies capable of meeting
these needs on a national and international basis.

BUSINESS STRATEGY

The Company's objective is to meet a significant portion of the training
and development needs of Fortune 1000 companies, other large and medium-sized
corporations and government entities. To achieve this objective, the Company
intends to pursue a business strategy with the following key elements:

OFFER VALUE-ADDED, HIGH-QUALITY TRAINING. The Company is committed to
providing value-added training and development services and products that result
in measurable improvement in the workplace performance of employees. The
Company's services and products are based upon well-researched methodologies,
processes and content, and typically have been developed, refined and used
successfully over many years. Most of the Founding Companies' executives have
advanced degrees and are regarded as leaders in their respective areas. The
Company strives to offer high-quality training by continually updating its
content to reflect changing industry trends and client preferences.

PROVIDE A BROAD RANGE OF SERVICES AND PRODUCTS. The Company seeks to
provide its clients with a broad range of high-quality training and development
services and products in both customized and off-the-shelf formats. These
services and products cover: employee selection, recruitment and retention;
employee work skills enhancement; employee management and leadership skills; and
organizational assessment, direction and change. Specifically, the Company
assists organizations and their employees in, among other things, determining
and implementing hiring criteria, increasing workplace diversity awareness,
improving communication skills, increasing point-of-sale efficiencies, working
in a team environment and soliciting and analyzing employee feedback. In
addition, the Company provides strategic consulting services to its clients,
which are enhanced by the Company's ability to offer complementary training and
development services and products.

UTILIZE MULTIPLE DELIVERY METHODS. The Company offers multiple delivery
methods for its services and products, including instructor-led seminars,
train-the-trainer, interactive multimedia software (such as CD-ROM) and
distance-based media (such as video conferencing, intranets and the Internet).
Two of the

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<PAGE> 40

Founding Companies, LSS and Star, have substantial expertise in delivery
technology which the Company intends to apply to many of the services and
products of the other Founding Companies. By offering multiple delivery methods,
the Company believes that it can better serve the needs, resource constraints
and cost requirements of its clients.

DEVELOP LONG-TERM CLIENT RELATIONSHIPS. The Company seeks to develop
long-term relationships with clients to whom it can provide a full complement of
services and products on a recurring basis. Many of the Company's long-term
clients purchase its services and products on an on-going basis after the
initial delivery of services and products. For example, after a
train-the-trainer seminar where the Company certifies a client's instructors,
the Company continues to receive a fee on a participant or site basis as the
certified instructors continue to train the client's employees. The Company also
offers updated, related or new services and products to its clients in order to
generate recurring revenue.

EMPLOY A DECENTRALIZED MANAGEMENT STRUCTURE. The Company believes that the
experienced management teams of the Founding Companies have a valuable
understanding of their respective training and development markets and have
established strong client relationships. The Company intends to operate with a
decentralized management structure under which management at each of the
Founding Companies will make most of the day-to-day operating decisions and will
have primary responsibility for the profitability and growth of their business.
The Company intends to utilize stock ownership as well as appropriate incentive
compensation to ensure that management's objectives at each of the Founding
Companies are aligned with those of the Company.

IMPLEMENT BEST PRACTICES AND ACHIEVE OPERATING EFFICIENCIES. The Company
intends to evaluate the operating policies and procedures of the Founding
Companies in order to identify and implement Company-wide best practices in
areas such as marketing, sales, product development, human resource policies and
recruiting. In addition, the Company believes that it can achieve operating
efficiencies and cost savings by more efficiently utilizing the Company's
facilities and gaining greater purchasing power in areas such as travel,
employee benefits and communications.

GROWTH STRATEGY

The Company's objective is to become the leading single source provider of
high-quality training and development services and products to Fortune 1000
companies, other large and medium-sized corporations and government entities.
Key elements of the Company's growth strategy include:

CAPITALIZE ON CROSS-SELLING OPPORTUNITIES. The Company believes that
significant opportunities exist for each Founding Company to cross-sell its
services and products to clients of the other Founding Companies. Each of the
Founding Companies has established strong relationships with its clients but
historically has offered its clients only a limited selection of training and
development services and products. The Company provided training and development
services to more than 1,700 companies and more than 75 government entities in
fiscal 1997, and during that period generated revenue of more than $100,000 from
each of 75 different companies and over 15 different federal government
agencies. The Company intends to capitalize on the services and products of each
of the Founding Companies by emphasizing and aggressively cross-selling its
broad range of training and development services and products to its collective
client base.

IMPLEMENT AGGRESSIVE SALES AND MARKETING STRATEGY. The Company intends to
pursue an aggressive sales and marketing strategy designed to establish new
client relationships and expand existing relationships. Specifically, the
Company intends to: (i) hire additional salespeople to supplement the existing
sales efforts of the Founding Companies; (ii) establish a nationwide
telemarketing program focusing primarily on medium-sized corporations; and (iii)
participate in a greater number of conferences and trade shows. The Company
intends to direct its centralized marketing campaign to both new clients and
additional contacts within existing clients (e.g., targeting upper levels of
management if previous services provided by a Founding Company were marketed to
middle management). In addition, the Company intends to pursue relationships
with regional colleges and vocational/technical schools in order to market its
services and products to small and medium-sized companies and their employees.
The Company also intends to establish a national brand identification

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<PAGE> 41

under the Provant name, while preserving the value of the established names,
trademarks and client relationships of the Founding Companies.

EXPAND SERVICE AND PRODUCT OFFERINGS. The Company intends to broaden its
offerings of training and development services and products by developing or
acquiring new or complementary services and products. For example, the Company
currently is introducing a new employee recruitment product, based upon its
Behavioral Interviewing(R) process, that teaches clients how to recruit in a
tight labor market. In addition, the Company intends to capitalize on its
expertise in certain industries, such as the retail industry, by customizing
services and products for other similar industries, such as the hospitality,
transportation and healthcare industries.

PURSUE STRATEGIC ACQUISITIONS. The Company intends to pursue strategic
acquisitions in order to: (i) offer services or products complementary to those
it currently offers; (ii) gain expertise in new areas of training and
development; (iii) access new technology to expand the scope and quality of
delivery methods; and (iv) establish or enhance client relationships. The
Company seeks to acquire companies with strong management, profitable operating
results and leading positions within their respective markets. The Company
believes that acquisitions of this nature will improve its ability to be a
single source provider of high-quality training and development services and
products.

LEVERAGE INVESTMENTS IN TECHNOLOGY AND DEPLOY LEADING TECHNOLOGIES. A key
element of the Company's strategy is to capitalize on the technology investments
of the Founding Companies in order to deliver training and development services
and products to its clients in the most effective manner. For example, the
Company intends to apply the technical expertise of LSS and Star, which provide
training through interactive multimedia software, to convert certain products of
other Founding Companies to interactive multimedia software formats, such as
CD-ROM. The Company expects to deploy leading technologies in the delivery of
many of its services and products, including delivery through distance-based
media, such as video conferencing, intranets and the Internet, that can provide
interactive training to employees at multiple locations.

TRAINING AND DEVELOPMENT SERVICES AND PRODUCTS

The Company's training and development services and products assist
organizations in four principal areas: (i) employee recruitment, selection and
retention; (ii) employee work skills; (iii) employee management and leadership
skills; and (iv) organizational assessment, direction and change. Through these
services and products, the Company's clients can improve the quality of
employees entering the organization, the performance of employees within the
organization, and the ability of the organization as a whole to undergo change.
The Company offers services and products which are off-the-shelf as well as
customized to meet the specialized needs of particular clients. The following
table illustrates the principal training and development areas covered by the
Company's services and products:

<TABLE>
<CAPTION>
ORGANIZATIONAL
EMPLOYEE RECRUITMENT, EMPLOYEE MANAGEMENT ASSESSMENT,
SELECTION AND RETENTION EMPLOYEE WORK SKILLS AND LEADERSHIP SKILLS DIRECTION AND CHANGE
- ----------------------- ----------------------- ----------------------- -----------------------
<S> <C> <C> <C>
Interviewing candidates Customer service Analyzing employee Strategic consulting
Identifying specific training feedback Understanding employee
job competencies Public speaking Presentation skills perceptions
Retaining employees Spoken communication training Assessing
Addressing sexual training Coaching peers and organizational
harassment Buyer negotiating colleagues abilities and direction
Facilitating diversity Point-of-sale training Managing retail stores Measuring customer
General retail sales Communicating with satisfaction
training subordinates Designing quality
Specialized government Understanding diversity control
job training issues processes
Industrial skills Changing corporate
training culture
</TABLE>

EMPLOYEE RECRUITMENT, SELECTION AND RETENTION. The Company offers services
and products designed to assist clients in hiring and retaining effective
employees. In particular, the Company helps clients understand the skills
required of their employees, implement more effective recruitment, selection and
retention processes

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to maximize employee productivity, and reduce turnover rates. Through one of the
Company's products, Behavioral Interviewing(R), managers learn how to identify
specific job competencies required for success, interview prospective candidates
and evaluate their skills. For example, when the Behavioral Interviewing(R)
process was implemented at a large accounting firm seeking to refine its
employee selection process, the Company worked with the firm to determine
critical skills and competencies required of candidates and to develop interview
forms designed to elicit information pertaining to those skills and
competencies. Client recruiting directors were certified, and those certified
instructors then taught the Behavioral Interviewing(R) process to the client's
interviewers nationwide. In the year following the implementation of Behavioral
Interviewing(R), the number of candidates invited for office visits who received
offers of employment increased by 10%, reflecting an increase in the
effectiveness and efficiency of the screening and evaluation process.
SkilMatch(R), a related product, is an interactive software program designed to
streamline the process of developing structured interviews and ensure a
consistent selection process. Complementing these products are the Company's
outplacement services, which it provides to several federal government agencies
to assist in work force restructuring, and its diversity enhancement services,
which facilitate employee retention and development.

EMPLOYEE WORK SKILLS. The Company offers services and products designed to
provide or improve the skills necessary to perform a particular task or job.
These skills include public speaking/presentation, negotiation, general retail
sales, point-of-sale device operation, direct store delivery (receiving) and
customer service. Several of the Company's products, including The POS
Simulator, Direct Store Delivery Simulator, Cashier Ready and Produce
Identification Trainer, are designed to increase employee productivity in the
retail workplace by simulating important retail situations and environments in
interactive multimedia formats. Many of these products allow clients to measure
the effectiveness of the training. For example, a large grocery chain that used
The POS Simulator to improve the efficiency of its cashier training program
reduced the average number of hours required to train cashiers in certain key
competencies from 16 hours of traditional classroom training to six hours with
The POS Simulator. Another Company product, Effective Communicating(TM), is a
two-day workshop designed to enable clients' key staff members to become more
effective in public speaking, sales and other types of oral communication. The
Company also offers specialized industrial skills training for
government and corporate clients.

The Company provides customized work skills training to numerous federal
government entities and various state and local government entities. Most of the
services and products offered in this area involve the training of employees to
perform tasks that are unique to certain government jobs. For instance, the
Company has prepared courses for the Department of Defense covering topics from
technology applications for military aircrews to basic medical care and medical
management information systems for Army and Navy healthcare personnel. Courses
prepared for other federal agencies include Reengineering and Process Mapping
for the Department of Education, Principles of Purchasing for the Postal
Service, Introductory Correctional Training for the Bureau of Prisons, and
Training in the Use of Traffic Records for Problem Identification for the
National Highway Traffic Safety Administration. Typically, these training
courses and course materials are custom-designed by experts from the Company
working closely with members of the respective government entities.

EMPLOYEE MANAGEMENT AND LEADERSHIP SKILLS. The Company offers services and
products that are designed to improve employees' operational management,
supervisory and leadership skills. In particular, the Company helps managers to
create constructive feedback processes, operate retail stores, monitor, motivate
and communicate with subordinates and understand diversity issues. Managing
Individual and Team Effectiveness (MITE(R)), one of the Company's products, is
designed to provide managers in complex work environments with "360-degree"
feedback on their management skills. Another product, Retail Management Series
III (RMSIII), is a multi-component and highly adaptable program designed to
enhance their retail communication and coaching skills in order to improve the
productivity and profitability of managers' salespeople. For example, RMSIII was
used by a national specialty retailer seeking to increase the productivity of
its sales associates by focusing on its sales managers. The Company tailored
RMSIII to cover the sales management skills important to the retailer's
business, including sales management standards, commitment to goals and coaching
skills. The Company trained and certified district managers of the client to
teach RMSIII,

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<PAGE> 43

and those certified instructors trained sales managers and assistant managers in
over 200 of the client's stores. Three months following the introduction of the
Company's RMSIII product, stores using RMSIII reported an average increase in
sales of 27%, as compared to 14% in stores not using RMSIII. A third product,
Managing Inclusion, is a multi-day session designed to help individual managers
and client companies enhance understanding of workplace diversity, build morale
and satisfaction in the work force, and increase productivity through more
effective team relationships.

ORGANIZATIONAL ASSESSMENT, DIRECTION AND CHANGE. The Company provides
services and products designed to help organizations assess their strategic
direction and implement and manage change. The Company provides strategic
consulting services that help improve overall workplace performance by assisting
clients in, among other things, clarifying and communicating their business
strategies and redesigning their organizations and business processes. For
example, the Company assisted a large trucking company in developing alternative
organization designs and cost reduction initiatives. By using the Company's
recommendations to clarify its operating strategy and determine the core work of
its business, the trucking company was able to undertake significant structural
changes and implement cost-cutting measures that were responsible for
significantly increasing overall efficiency. The Company also provides its
clients with a variety of survey tools by which feedback can be gathered and
analyzed on either an organizational or individual basis. The Company develops
the survey forms and methodologies, conducts the surveys, and collects and
analyzes the data for its corporate clients.

DELIVERY METHODS

The Company offers multiple delivery methods for its training services and
products. By doing so, the Company believes that it can better serve the
particular needs, resource constraints, cost requirements and cultures of its
clients. Most of the Company's services and products currently are delivered
through instructor-led and train-the-trainer seminars; however, the Company also
delivers certain of its products on interactive multimedia software or through
distance-based methods. The Company's primary delivery methods are described
below.

INSTRUCTOR-LED TRAINING AND SEMINARS. The Company delivers its programs to
clients' employees primarily through the use of either dedicated Company
instructors or certified contract instructors. Most of the Company's
instructor-led training is delivered at clients' facilities, although the
Company also delivers certain programs at its own training facilities. In some
cases, the Company's programs are delivered in a public seminar format to a
small group of individuals from multiple client companies. The Company provides
textual materials and, in some cases, video tapes as a part of its
instructor-led programs. In addition, the Company sells related published
materials in connection with these programs. The Company also develops custom
courseware that ultimately is delivered by instructors (often client employees)
who are not certified by or otherwise affiliated with the Company. The Company's
courses and programs generally range in length from a few hours to several days
and include from one to hundreds of participants.

TRAIN-THE-TRAINER. For several of its services and products, the Company's
instructors train and certify qualified employees of clients in an
instructor-led program. The certified client employees then are licensed to use
the Company's methodologies and materials to train other employees of the client
in instructor-led classes at client sites. The Company supplies training
materials for these classes and on-going training for the certified trainers.
The Company receives fees for the employee-led classes on either a participant
or site basis.

INTERACTIVE MULTIMEDIA SOFTWARE. The Company delivers several of its
products on interactive multimedia software, such as CD-ROMs. Because of the
demonstrated higher rates of learning and retention achieved through interactive
multimedia training, the Company plans to convert to CD-ROM and other
interactive multimedia software several of its products that to date have been
offered only in the instructor-led or train-the-trainer formats.

DISTANCE-BASED MEDIA. The Company currently delivers a limited number of
its products through distance-based media, such as satellite or other video
conferencing, intranets and the Internet. The Company intends to seek new
technologies that will allow it to deliver its product offerings to clients more
effectively. In

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<PAGE> 44

particular, the Company believes that more of its products will be offered
through the Internet and more clients will seek Internet-delivered training as
the bandwidth of Internet access increases.

OTHER SERVICES AND PRODUCTS

In addition to the Company's training and development services and
products, one of the Founding Companies, Star, also provides certain other
services and products including computer network security research and
development (primarily for federal government entities) and computer network
design, sales, installation and support (primarily for corporations). These
services and products contributed 7.3% of pro forma revenue and (4.6)% of pro
forma income from operations for fiscal 1997. The Company does not anticipate
that sales of these services and products will have a material impact on its
future operating results.

CLIENTS

The Company seeks to establish long-term relationships with Fortune 1000
companies, other large and medium-sized corporations and government entities
with substantial training and development needs. The Company has developed a
broad client base of over 1,700 corporations, with no corporate client
accounting for more than 5% of the Company's pro forma revenue during fiscal
1997 or the three months ended September 30, 1997. The Company generated revenue
of more than $100,000 from each of 75 different corporate clients during fiscal
1997. The top corporate clients of the Founding Companies by revenue generated
during fiscal 1997 include those presented below.

<TABLE>
<S> <C> <C>
Abbott Laboratories Federal Express Metropolitan Life Insurance
Ameritech Corporation Federated Department Stores, Company
Amoco Corporation Inc. Mobil Corporation
Bank of America Flexsys Motorola, Inc.
BOC Gases Fujitsu Business Northwest Airlines, Inc.
Canadian-Hunter Exploration Communication Systems, Norwest Mortgage Inc.
Ltd. Inc. PepsiCo., Inc.
Canadian Imperial Bank of Hewlett-Packard Company Royal Bank of Canada
Commerce J.C. Penney Company, Inc. Siemens Business
Conoco, Inc. J.P. Morgan & Co. Communication Systems,
Consolidated Rail Incorporated Inc.
Corporation The Kroger Co. U.S. West, Inc.
Coopers & Lybrand L.L.P. Lukens Steel Company Venture Stores, Inc.
Dayton Hudson Corporation McDonnell-Douglas Victoria's Secret Stores
Deloitte & Touche LLP Corporation Wakefern Food Corporation
Eli Lilly and Company Yellow Corporation
Exxon Corporation
</TABLE>

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<PAGE> 45

Star derives a substantial majority of its revenues from customized
training and development services and products delivered to entities affiliated
with the federal government. During fiscal 1997 and the three months ended
September 30, 1997, Star's training and development work for federal government
clients generated approximately 31.1% and 30.6%, respectively, of the Company's
pro forma combined revenue. Star also provides services and products to state
and local government entities. The Company's top federal government clients by
revenue generated during fiscal 1997 include the following:

<TABLE>
<S> <C>
Defense Commissary Agency Food Safety and Inspection
Defense Logistics Agency General Accounting Office
Department of Army General Services Office
Department of Energy Immigration and Naturalization
Department of Navy Service
Drug Enforcement Administration Indian Health Service
Federal Aviation Administration Internal Revenue Service
Federal Highway Administration Pension Benefit Guarantee
Federal Law Enforcement Training Corporation
Center United States Marshals Service
United States Postal Service
</TABLE>

SALES AND MARKETING

Historically, the Founding Companies have used a variety of sales
strategies. The majority of the Founding Companies maintain dedicated
salespersons who seek to identify leads, qualify prospects and close sales
related to their specific training services and products. In some instances, the
salespersons also serve as the instructors or consultants for such services and
products. Generally, each of the Founding Companies targets its prospects
primarily through direct sales, public seminars, client referrals and a variety
of media, including direct mailings, the Founding Companies' web sites and trade
publications. In addition, several of the Founding Companies are able to obtain
clients as a result of the visibility of their principals, who have published
articles and books, appeared on television news shows or otherwise created a
strong reputation in their various fields of training. The Company currently
markets its services and products to its clients mainly through their human
resources personnel, business unit managers or regional managers and, to a
lesser extent, through senior executives. However, the Company intends to focus
increasingly on marketing to senior executives of both existing and targeted
clients through initial contacts made by members of the Company's Board of
Directors and senior management, as well as by the principals of the Founding
Companies.

The Company generates significant revenues through sales of services and
products to government entities. Typically, these sales occur through a
competitive bidding process started by a government entity's issuance of a
request for proposal ("RFP") for a contemplated project. The Company may submit
a proposal on its own behalf or as a subcontractor to another company. Many
services and products delivered to federal government agencies are provided
through orders placed under a General Services Administration ("GSA") Supply
Schedule contract and under Office of Personnel Management/Training Management
Assistance ("OPM"). The Company is one of only a few training providers
authorized under both funding mechanisms. The Company (through Star) benefits
from its status as a preferred provider under certain funding mechanisms
(including the GSA and OPM vehicles) which allow it to negotiate contracts
without an RFP.

Following the consummation of the Offering, the Company expects to
capitalize on cross-selling opportunities among the clients of the Founding
Companies. The Company intends to hire additional salespeople to supplement the
existing sales efforts of the Founding Companies and establish a nationwide
telemarketing program focusing on medium-sized corporations. In addition, the
Company is developing a marketing and advertising program to establish a
national brand identification under the Provant name, while preserving the value
of the established names, trademarks and customer relationships of the Founding
Companies.

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COMPETITION

The training and development industry is highly fragmented and competitive,
and the Company expects this competition to increase. The Company believes the
principal competitive factors in the industry are the strength of client
relationships, quality, price and breadth of service and product offerings,
quality and number of delivery methods, reputation, and the ability to provide
customized services and products. Some of the Company's competitors have
significantly greater financial, managerial, technical, marketing and other
resources than the Company. Moreover, the Company expects that it will face
additional competition from new entrants into the training and development
market due, in part, to the evolving nature of the market and the relatively low
barriers to entry.

The Company competes with thousands of privately-held training companies,
most of which provide a limited range of services and products. In addition to
these small competitors, a number of larger companies are engaged in the
business of providing training and development services and products, including
Times Mirror Training Group (a subsidiary of the Times Mirror Company), The
Forum Corporation, Development Dimensions International, Wilson Learning
Corporation and several large publishers of professional reference materials who
recently have entered the industry. The Company also competes with large
professional service companies such as Andersen Consulting, Ernst & Young LLP,
Towers Perrin and others that generally offer training services in conjunction
with strategic consulting and other client assignments of larger scope. In
addition, many of the Company's clients and potential clients have internal
training departments. See "Business -- Market Overview."

The Company's competitors for government contracts include service
companies such as Booz Allen, as well as contract suppliers of equipment to the
government such as Raytheon Company, McDonnell-Douglas Corporation and Lockheed
Martin Corporation.

INTELLECTUAL PROPERTY

The Company regards many of its training and development services and
products as proprietary and relies primarily on a combination of statutory and
common law copyright, trademark, service mark and trade secret laws, customer
licensing agreements, employee and third-party nondisclosure agreements and
other methods to protect its proprietary rights. Notwithstanding this, a third
party or parties could copy or otherwise obtain and use the Company's products
in an unauthorized manner or use these products to develop training and
development processes that are substantially similar to those of the Company.
The Company's products generally do not include any mechanisms to prohibit or
prevent unauthorized use by third parties. There can be no assurance that the
Company's means of protecting its proprietary rights will be adequate or that
the Company's competitors will not independently develop similar training
products and delivery methods. Additionally, there can be no assurance that
third parties will not claim that the Company's current or future products
and/or services infringe on the proprietary rights of others. See "Risk
Factors -- Risks Associated with Intellectual Property."

EMPLOYEES

The Company currently employs approximately 600 full-time and part-time
employees and believes that its relationships with its employees are good.

INDEPENDENT CONTRACTORS

The Company provides certain of its services and products through
approximately 200 independent contractors. The Company does not pay federal
employment taxes or withhold income taxes with respect to these independent
contractors or include them in the Company's employee benefit plans. See "Risk
Factors -- Independent Contractor Status."

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<PAGE> 47

FACILITIES

The Company leases its principal executive office located in Boston,
Massachusetts, and maintains 23 additional leased office locations in 12 states
and one in Canada. The remaining terms of the Company's leases are less than
eight years. The Company believes that these facilities are adequate to serve
its current level of operations. If additional facilities are required, the
Company believes that suitable additional or alternative space will be available
as needed on commercially reasonable terms.

LEGAL PROCEEDINGS

The Company is from time to time a party to litigation arising in the
ordinary course of business. Management believes that no pending legal
proceeding will have a material adverse effect on the business, financial
condition or results of operations of the Company.

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<PAGE> 48

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information concerning the Company's
directors and executive officers, and those persons who will become directors
and executive officers upon the consummation of the Offering.

<TABLE>
<CAPTION>
NAME AGE POST-OFFERING POSITION
- ----------------------------------- --- ----------------------------------------------------
<S> <C> <C>
Paul M. Verrochi................... 49 Chairman and Chief Executive Officer
John H. Zenger..................... 66 President and Director
Dominic J. Puopolo................. 54 Executive Vice President, Chief Financial Officer
and Director
Rajiv Bhatt........................ 40 Senior Vice President, Treasurer and Chief
Accounting Officer
Philip Gardner..................... 34 Vice President
Herbert A. Cohen................... 61 President - MOHR, Director
Bert Decker........................ 57 President - Decker, Director
Paul C. Green...................... 56 President - BTI, Director
Joe Hanson......................... 40 Managing Director - Novations, Director
John F. King....................... 43 President - LSS, Director
A. Carl von Sternberg.............. 69 President - Star, Director
Marc S. Wallace.................... 50 President - J. Howard, Director
Michael J. Davies.................. 53 Director
</TABLE>

Paul M. Verrochi will become Chairman of the Board and Chief Executive
Officer of the Company upon the consummation of the Offering. Prior to the
Offering, Mr. Verrochi has been President and a director of Provant. Mr.
Verrochi also is Chairman, co-founder and a principal of American Business
Partners LLC ("ABP"). In 1992, Mr. Verrochi co-founded American Medical
Response, Inc. ("AMR"), which prior to its acquisition by Laidlaw Inc. in
January 1997 was the largest provider of ambulance services in the United
States. From August 1992 to January 1996, Mr. Verrochi served as AMR's President
and Chief Executive Officer, and until January 1997 he also served as the
Chairman of the Board of Directors. Mr. Verrochi was selected as the 1995
National Entrepreneur of the Year for Emerging Growth Companies by Inc.
Magazine. Mr. Verrochi serves as an advisory board member to numerous charitable
foundations, including the New England Aquarium and the Boston Symphony
Orchestra. Mr. Verrochi is Chairman of BridgeStreet Accommodations, Inc. and a
director of Coach USA, Inc. Mr. Verrochi received his Bachelor of Science degree
from the United States Merchant Marine Academy at Kings Point, New York.

John H. Zenger will become President and a director of the Company upon the
consummation of the Offering. Prior to the Offering, since May 1997, Mr. Zenger
has been a consultant to Provant. From April 1992 to November 1996, Mr. Zenger
was employed in various capacities, including Vice President and Chairman, by
the Times Mirror Training Group, the nation's largest group of training
companies, consisting of Kaset, Learning International and Zenger Miller, the
company that he founded in 1977. Mr. Zenger has taught at the University of
Southern California School of Business and the Stanford Graduate School of
Business. Mr. Zenger received his Doctorate degree in Business Administration
from the University of Southern California, his Masters in Business
Administration from the University of California, Los Angeles and his Bachelor
of Science degree from Brigham Young University.

Dominic J. Puopolo will become Executive Vice President and Chief Financial
Officer of the Company upon the consummation of the Offering. Prior to the
Offering, Mr. Puopolo has been Treasurer and a director of Provant. Mr. Puopolo
is a co-founder and principal of ABP. In 1992, Mr. Puopolo co-founded AMR. From
August 1992 to January 1996, Mr. Puopolo served as Executive Vice President,
Chief Financial Officer, Treasurer and a member of the Board of Directors of
AMR. Mr. Puopolo serves as a member of the Board of Trustees of Emerson College
of Communications and is Chairman of its Resource Development Committee. Mr.
Puopolo also serves on the Executive Committee of the Boston University School
of Medicine and is a

47
<PAGE> 49

member of the Board of Trustees of Northeastern University. Mr. Puopolo, a
Certified Public Accountant, is a member of the Massachusetts Society of
Certified Public Accountants, The American Institute of Certified Public
Accountants and the National Association of Accountants. Mr. Puopolo received
his Masters in Business Administration degree from Suffolk University and his
Bachelor of Science degree in Business Administration from Northeastern
University.

Rajiv Bhatt will become Senior Vice President, Treasurer and Chief
Accounting Officer of the Company upon the consummation of the Offering. Prior
to the Offering, since August 1997, Mr. Bhatt has been a consultant to Provant.
From September 1994 to August 1997, Mr. Bhatt was Executive Vice President,
Chief Financial Officer and Treasurer of Summit Technology, Inc., a
publicly-traded manufacturer of ophthalmic laser systems. From September 1988 to
September 1994, Mr. Bhatt was Chief Financial Officer, Secretary and a member of
the Board of Directors of Carlisle Plastics, Inc., a publicly-traded plastics
manufacturer. Also from September 1988 to September 1994, Mr. Bhatt was Chief
Financial Officer of Carlisle Capital Corporation, a privately held mergers and
acquisitions company. Mr. Bhatt is a Certified Public Accountant. Mr. Bhatt
received his Masters in Business Administration degree from the University of
Michigan and his Bachelor of Commerce degree from the University of Bombay.

Philip Gardner will become Vice President of the Company upon the
consummation of the Offering. Prior to the Offering, since February 1997, Mr.
Gardner has been a consultant to Provant. From August 1994 to December 1996, Mr.
Gardner was a consultant for McKinsey & Company ("McKinsey"), a management
consulting firm. Prior to joining McKinsey, from 1985 to 1992, Mr. Gardner was
an officer and a highly decorated strike fighter pilot in the United States
Navy. Mr. Gardner received his Masters in Business Administration degree from
Harvard Graduate School of Business Administration and his Bachelor of Arts
degree in Government from Harvard College.

Herbert A. Cohen will become a director of the Company immediately
following the consummation of the Offering. Mr. Cohen has been Chief Executive
Officer of MOHR since February 1991. From September 1978 to January 1991, Mr.
Cohen was a partner and one of the original principals of MOHR Development,
Inc., a training and consulting company. Mr. Cohen has served as President and
Director of the Instructional Systems Association, an association of over 150
training companies dedicated to improving performance through training. Mr.
Cohen received his Bachelor of Science degree in Psychology from the University
of Maine.

Bert Decker will become a director of the Company immediately following the
consummation of the Offering. Mr. Decker has been Chairman and Chief Executive
Officer of Decker since October 1979. Mr. Decker is the author of the
best-selling books You've Got to be Believed to be Heard and Creating Messages
That Motivate. Mr. Decker also is the personal communications trainer for
Charles Schwab and Olympic gold medalist Bonnie Blair. Mr. Decker has appeared
on several national television programs, including The Today Show and 20/20. Mr.
Decker received his Bachelor of Arts degree in Psychology from Yale University.

Paul C. Green, Ph.D. will become a director of the Company immediately
following the consummation of the Offering. Dr. Green has been Chief Executive
Officer of BTI since May 1979. Dr. Green developed the Behavioral
Interviewing(R) seminar, which has been attended by several hundred thousand
managers worldwide. Dr. Green has also served as Assistant Professor in the
Marketing Department at Memphis State University, where he taught courses in
salesmanship, sales promotion, sales management and consumer behavior. Dr. Green
received his Doctorate degree in Industrial-Organizational Psychology from
Memphis State University, his Master of Science degree in Psychology from
Memphis State University and his Bachelor of Arts degree from Lambuth College.

Joe Hanson will become a director of the Company immediately following the
consummation of the Offering. Mr. Hanson has been a Managing Director of
Novations since August 1989. From September 1983 to June 1987 Mr. Hanson was a
consultant for KPMG Peat Marwick LLP. Mr. Hanson is a Certified Public
Accountant. Mr. Hanson received his Masters in Business Administration degree
from Brigham Young University and his Bachelor of Science degree in Accounting
from Brigham Young University.

48
<PAGE> 50

John F. King will become a director of the Company immediately following
the consummation of the Offering. Mr. King has been Chief Executive Officer of
LSS since December 1990. From October 1981 to November 1988, Mr. King was
employed by Wilson Learning where he served in various capacities including
Regional Sales Manager, Account Executive, and Performance Consultant. Mr. King
previously served as Professor of Communications Studies at McKendree College.
Mr. King received his Master of Arts degree in Communication Studies, Mass
Communications from Purdue University and his Bachelor of Arts degree from
California State University, Long Beach.

A. Carl von Sternberg will become a director of the Company immediately
following the consummation of the Offering. Mr. von Sternberg has been President
of Star since September 1987. In 1975, Mr. von Sternberg founded Allen
Corporation of America ("Allen") a firm specializing in training, human factors,
engineering and logistics services. From October 1975 to May 1986, Mr. von
Sternberg was President and Chairman of Allen, which was selected in 1982 by
Inc. Magazine as one of America's 500 fastest growing private companies. Prior
to founding Allen, Mr. von Sternberg served as Executive Vice President and
Chief Operating Officer of Essex Corporation, a behavioral science research
company, which he co-founded in 1969. Mr. von Sternberg received his Bachelor of
Science degree in Industrial Administration from Yale University.

Marc S. Wallace will become a director of the Company immediately following
the consummation of the Offering. Mr. Wallace has been President of J. Howard
since January 1991 and Treasurer since April 1986. Mr. Wallace serves on the
Boards of Directors of Belmont Hill School and the Berklee School of Music, on
the Board of Advisors of First Community Bank in Boston and as a member of the
Northeastern University Corporation. Mr. Wallace also is a member of the Boston
Chamber of Commerce. Mr. Wallace received his Masters in Business Administration
degree with a concentration in Finance from Central Michigan University and his
Bachelor of Arts degree from Adams State College.

Michael J. Davies will become a director of the Company upon the
consummation of the Offering. Mr. Davies has been a consultant to Provant since
February 1997, and will continue to be a consultant following the Offering. From
April 1994 to June 1997, Mr. Davies was a Managing Director of Legg Mason Wood
Walker, Incorporated, specializing in media and communications. From September
1990 to March 1993, Mr. Davies was publisher of The Baltimore Sun. Mr. Davies is
a member of the Board of Directors of Mecklermedia Corporation, a provider of
Internet news, information and analysis through its magazines, trade shows and
web site. Mr. Davies received his Master of Science degree in Journalism from
the Medill School of Journalism at Northwestern University and his Bachelor of
Science degree from Georgia State University.

MANAGEMENT OF THE COMPANY FOLLOWING THE COMBINATION

Upon the consummation of the Offering, the Company intends to operate with
a decentralized management structure. Messrs. Verrochi, Zenger, Puopolo, Bhatt
and Gardner will manage the Company's operations and be responsible for areas
including strategic planning, acquisitions, resource allocation, capital
financing, financial reporting, marketing efforts and human resources. They will
work closely with the Founding Companies to coordinate, integrate and expand
their service and product offerings. Messrs. Cohen, Decker, Green, Hanson, King,
von Sternberg and Wallace (together with the other key executives of the
Founding Companies) will continue to make day-to-day operating decisions and be
primarily responsible for the operations of their respective Founding Companies.

BOARD OF DIRECTORS

After consummation of the Combination and the Offering, the Board of
Directors will consist of 11 directors. In addition, following the Offering, the
Board expects to elect three outside directors. The term of office of each
director of the Company ends at the next annual meeting of the Company's
stockholders and when his or her successor is elected and qualified. Following
the Offering, the Board of Directors will establish an Audit Committee, a
Compensation Committee and such other committees as the Board may determine. The
Audit Committee, a majority of which will be outside directors, will make
recommendations concerning the engagement of independent public accountants,
review with the independent public accountants the plans for and results of the
Company's annual audit, approve professional services provided by and the
independence

49
<PAGE> 51

of the independent public accountants, consider the range of audit and non-audit
fees, and review the adequacy of the Company's internal accounting controls. The
Compensation Committee, all of which will be outside directors, will establish a
general compensation policy for the Company, approve increases in directors'
fees and salaries paid to officers and senior employees of the Company,
administer the Company's 1998 Equity Incentive Plan, Stock Plan for Non-Employee
Directors and 1998 Employee Stock Purchase Plan, and determine, subject to the
provisions of the Company's employee benefit plans, the directors, officers and
employees of the Company eligible to participate in any of the plans, the extent
of such participation and the terms and conditions under which benefits may be
vested, received or exercised.

Officers of the Company serve at the pleasure of the Board of Directors,
subject to the terms of any employment agreements with the Company.

DIRECTOR COMPENSATION

Members of the Board of Directors who also serve as officers of or
full-time consultants to the Company or its subsidiaries do not receive
compensation for serving on the Board. Each other member of the Board will
receive a fee of $3,000 for each Board of Directors meeting attended and an
additional fee of $500 for each committee meeting attended. All directors will
receive reimbursement of reasonable expenses incurred in attending Board and
committee meetings and otherwise carrying out their duties. Non-employee
directors also are entitled to receive an option grant as described in "-- Stock
Plan for Non-Employee Directors."

EXECUTIVE COMPENSATION; EMPLOYMENT AGREEMENTS

The Company was incorporated in 1996 and has conducted no operations and
paid no compensation to its officers in fiscal 1997. The Company has entered
into employment agreements, the terms of which are effective upon the closing of
the Offering, with its executive officers. The material terms of these
agreements are summarized below.

The Company's employment agreement with each of Messrs. Verrochi, Zenger,
Puopolo, Bhatt and Gardner has a term of three years, and provides for an
initial base salary (subject to upward adjustment in the sole discretion of the
Company's Board of Directors) and participation in the Company's bonus and
benefit plans. The initial base salaries for Messrs. Verrochi, Zenger, Puopolo,
Bhatt and Gardner are $50,000, $150,000, $50,000, $200,000 and $125,000,
respectively. The salaries to be paid to Messrs. Verrochi and Puopolo after the
first year of the term of their employment agreements will be determined by the
Company's Board of Directors. Each of the five agreements may be terminated
prior to the expiration of the three-year term either in the event of disability
or for cause (as defined). If any of the individuals does not continue to be
employed by the Company upon the expiration of the agreement, the individual is
entitled to receive six months' severance at his base salary as in effect at the
time of expiration. Each of Messrs. Verrochi, Zenger, Puopolo, Bhatt and Gardner
has agreed not to compete with the Company for a period of five years from the
closing date of the Offering. Under their employment agreements, Messrs.
Verrochi and Puopolo are entitled to receive options to purchase 44,092 shares
of Common Stock each. See "-- Equity Incentive Plan."

The principals of the Founding Companies who will become directors of the
Company immediately following the closing of the Combination will enter into a
three-year employment agreement with the Company or a subsidiary of the Company,
the material terms of which are described in "Certain Transactions --
Organization of the Company."

EQUITY INCENTIVE PLAN

The Company has adopted the 1998 Equity Incentive Plan (the "Equity
Incentive Plan"), which provides for the award of up to 1,100,000 shares of
Common Stock in the form of incentive stock options ("ISOs"), non-qualified
stock options, stock appreciation rights, performance shares, restricted stock
or stock units (each, an "Award"). All directors and employees of, and all
consultants and advisors to, the Company (including its subsidiaries) are
eligible to participate in the Equity Incentive Plan.

50
<PAGE> 52

The Equity Incentive Plan will be administered by the Compensation
Committee (the "Committee"), which determines who shall receive Awards from
those individuals eligible to participate in the Equity Incentive Plan, the type
of Award to be made, the number of shares of Common Stock that may be acquired
pursuant to the Award and the specific terms and conditions of each Award,
including the purchase price, term, vesting schedule, restrictions on transfer
and any other conditions and limitations applicable to the Awards or their
exercise. Options that are ISOs may be exercisable for not more than 10 years
after the date the option is awarded. The Committee may at any time accelerate
the exercisability of all or any portion of an option.

In the event of a merger or consolidation in which the Company is not the
surviving corporation or which results in the acquisition of substantially all
the Company's outstanding shares of capital stock, or in the event of the sale
or transfer of substantially all of the Company's assets, if the Committee so
determines, all outstanding Awards will terminate, provided that on or before 20
days prior to the proposed effective date of any such transaction, the Committee
either (i) makes all outstanding Awards exercisable prior to the consummation of
the transaction or (ii) arranges for the surviving or acquiring corporation, if
any, to assume the Awards or grant to participants replacement Awards.

The Equity Incentive Plan may be amended from time to time or terminated in
its entirety by the Board of Directors; however, no amendment may be made
without stockholder approval if such approval is necessary to comply with any
applicable tax or regulatory requirement.

In connection with the Offering, the Company will grant Messrs. Verrochi,
Zenger, Puopolo, Bhatt and Gardner options to purchase 44,092, 100,000, 44,092,
50,000 and 10,000 shares of Common Stock, respectively, each of which will have
a per share exercise price equal to the initial offering price. The options
granted to Messrs. Zenger, Bhatt and Gardner will become exercisable with
respect to one-third of the underlying shares of Common Stock on each of the
first three anniversaries of the date of grant, and the options granted to
Messrs. Verrochi and Puopolo will become exercisable with respect to all of the
underlying shares of Common Stock upon the closing of the Offering. Mr. Davies
also will be granted an option to purchase 50,000 shares of Common Stock, the
terms of which are described in "Certain Transactions."

In addition to the options to be granted to Messrs. Verrochi, Zenger,
Puopolo, Bhatt, Gardner and Davies, the Company will award to employees and
consultants of the Founding Companies and Provant options under the Equity
Incentive Plan to purchase an aggregate of 535,280 shares of Common Stock, with
each such option having a per share exercise price equal to the initial public
offering price.

STOCK PLAN FOR NON-EMPLOYEE DIRECTORS

The Company's Board of Directors has adopted the Stock Plan for
Non-Employee Directors (the "Directors' Plan"). Subject to adjustment for stock
splits and similar events, a total of 100,000 shares of Common Stock have been
reserved for issuance under the Directors' Plan. Pursuant to the Directors'
Plan, in connection with the Offering, each director and director nominee who is
not an employee of or consultant to the Company or one of its subsidiaries (a
"non-employee director") and is not a stockholder of the Company prior to the
offering will receive an option to purchase 7,500 shares of Common Stock with a
per share exercise price equal to the initial public offering price. Each
non-employee director initially elected following the Offering will be granted
upon such election an option to purchase 7,500 shares of Common Stock. The per
share exercise price of options granted following the Offering will be the fair
market value of the Common Stock on the date of grant. Each option will be
non-transferable except upon death (unless otherwise approved by the Board),
will expire 10 years after the date of grant and will become exercisable with
respect to all of the shares of Common Stock issuable thereunder on the date
that is six months following the date of grant if the individual is a director
at such time. If the director dies or otherwise ceases to be a director prior to
the expiration of an option, the option (if exercisable) will remain exercisable
for a period of one year (following death) or three months (following other
termination of the individual's status as a director), but in no event beyond
the tenth anniversary of the date of grant. The Board of Directors may at any
time or times amend the Directors' Plan for any purpose that at the time may be
permitted by law.

As of the date of the closing of the Offering, no options will have been
granted under the Directors' Plan.

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<PAGE> 53

STOCK PURCHASE PLAN

The 1998 Employee Stock Purchase Plan (the "Employee Stock Purchase Plan")
has been approved by the Board of Directors and stockholders of the Company. The
Employee Stock Purchase Plan is designed to enable eligible employees to
purchase shares of Common Stock at a discount on a periodic basis through
payroll deductions. All employees with at least six months of continuous
service, other than employees owning 5% or more of the combined voting power of
all classes of stock of the Company, will be eligible to participate. Purchases
will occur at the end of option periods, each of six months' duration. The first
such option period will begin on July 1, 1998. The purchase price of Common
Stock under the Employee Stock Purchase Plan will be 85% of the lesser of the
value of the Common Stock at the beginning of an option period and the value of
the Common Stock at the end of the option period. Participants may elect under
the Employee Stock Purchase Plan, prior to each option period, to have from 2%
to 10% of their pay withheld and applied to the purchase of shares at the end of
the option period.

Subject to adjustment for stock splits and similar events, a total of
500,000 shares of Common Stock has been reserved for issuance under the Employee
Stock Purchase Plan. None of these shares has been issued to date.

LIMITATION OF CERTAIN LIABILITY OF OFFICERS AND DIRECTORS

As permitted by the DGCL, the Company's Certificate of Incorporation
provides for the elimination, subject to certain conditions, of the personal
liability of directors of the Company for monetary damages for breach of their
fiduciary duties. The directors, however, remain subject to equitable remedies
and to liability for breach of their duty of loyalty to the Company or its
stockholders. The Company's Certificate of Incorporation and By-laws also
provide that the Company will indemnify its directors and officers. In addition,
the Company maintains an indemnification insurance policy covering all directors
and officers of the Company. In general, the Company's Certificate of
Incorporation, By-laws and the indemnification insurance policy attempt to
provide the maximum protection permitted by Delaware law with respect to
indemnification and exculpation of directors and officers.

Under the indemnification provisions of the Company's Certificate of
Incorporation and By-laws and the indemnification insurance policy, the Company
will repay certain expenses incurred by a director or officer in connection with
any civil or criminal action or proceeding, specifically including actions by or
in the name of the Company (derivative suits), where the individual's
involvement is by reason of the fact that he or she is or was a director or
officer of the Company. Such indemnifiable expenses include, to the maximum
extent permitted by law, attomey's fees, judgments, civil or criminal fines,
settlement amounts, and other expenses customarily incurred in connection with
legal proceedings. A director or officer will not receive indemnification if he
or she is found not to have acted in good faith and in a manner he or she
reasonably believed to be in, or not opposed to, the best interests of the
Company.

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<PAGE> 54

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock, after giving effect to the Combination,
by (i) each director and director nominee of the Company, (ii) certain executive
officers of the Company, (iii) all directors, director nominees and executive
officers as a group, and (iv) each person or entity known to the Company to own
beneficially more than 5% of the outstanding Common Stock. The persons named in
this table have an address c/o the Company's principal executive offices, and,
except as indicated in the footnotes below, have sole investment and voting
power with respect to the shares beneficially owned by them.

<TABLE>
<CAPTION>
PERCENTAGE OWNED (2)
---------------------
SHARES BEFORE AFTER
NAME OF BENEFICIAL OWNER (1) OFFERING OFFERING
- ------------------------------------------------------------- --------- -------- --------
<S> <C> <C> <C>
Paul M. Verrochi (3)(4)...................................... 1,090,591 15.5% 11.3%
John H. Zenger............................................... 262,678 3.9 2.8
Dominic J. Puopolo (3)(5).................................... 1,023,222 14.6 10.6
Rajiv Bhatt.................................................. 88,634 1.3 *
Philip Gardner............................................... 302,506 4.4 3.2
Herbert A. Cohen (6)......................................... 112,903 1.7 1.2
Bert Decker.................................................. 203,047 3.0 2.2
Paul C. Green................................................ 425,352 6.3 4.5
Joe Hanson................................................... 74,059 1.1 *
John F. King................................................. 316,627 4.7 3.4
A. Carl von Sternberg (7).................................... 548,710 8.1 5.8
Marc S. Wallace.............................................. 152,701 2.2 1.6
Michael J. Davies (8)........................................ 335,424 4.9 3.5
All directors, director nominees and executive officers as a
group (13 persons) (9)..................................... 4,936,454 67.7 49.9
</TABLE>

- ---------------
* Less than 1%.

(1) Share information assumes an initial public offering price of $12.00 per
share. The Founding Companies' merger agreements specify the aggregate
dollar values, but not the share amounts, of the Common Stock to be received
by their stockholders in the Combination. As a result, if the initial public
offering price is less or greater than $12.00, the Founding Companies'
stockholders (and in particular, Messrs. Cohen, Decker, Green, Hanson, King,
von Sternberg and Wallace) will receive a larger or smaller number of shares
of Common Stock, respectively. In addition, Provant will declare a stock
dividend on all outstanding Common Stock prior to the closing of the
Combination such that, without giving effect to the Offering (but giving
effect to the Combination), there will be outstanding a total of 6,805,605
shares of Common Stock. The size of the stock dividend (and as a result, the
number of shares of Common stock held by Messrs. Verrochi, Zenger, Puopolo,
Bhatt, Gardner and Davies) will vary if the initial offering price is less
or greater than $12.00, with the size of the dividend increasing if the
initial public offering price increases and decreasing if the initial public
offering price decreases.

(2) Percentages in the table are based upon 6,805,605 and 9,405,605 shares of
Common Stock assumed to be outstanding as of the closing of the Combination
and the Offering, respectively.

(3) Includes 176,368 shares (assuming that the individual does not exercise such
warrant prior to the closing of the Offering) issuable pursuant to a warrant
that currently is exercisable, and 44,092 shares issuable upon the exercise
of an option that will become exercisable in full upon the closing of the
Offering. Excludes 220,460 shares issuable upon the exercise of the
Contingent Warrant described in "Certain Transactions."

(4) Includes 54,035 shares held by Mr. Verrochi's wife, and 125,500 shares held
by a trust of which Mr. Verrochi is trustee and as to which Mr. Verrochi
disclaims beneficial ownership.

(5) Includes 54,035 shares held by Mr. Puopolo's wife, and 125,500 shares held
by a trust of which Mr. Puopolo is trustee and as to which Mr. Puopolo
disclaims beneficial ownership.

(6) Includes 56,451 shares held by Mr. Cohen's wife.

(7) Includes 38,481 shares held by Mr. von Sternberg's wife.

(8) Includes 50,000 shares issuable upon the exercise of an option that will
become exercisable in full upon the closing of the Offering.

(9) See notes 3, 4, 5, 6, 7 and 8 above.

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<PAGE> 55

CERTAIN TRANSACTIONS

ORGANIZATION OF THE COMPANY

The Combination will be accomplished through separate mergers of each
Founding Company with a separate, newly formed subsidiary of the Company. As a
result, after the closing of the Combination and the Offering (the "Closing"),
all of the assets, liabilities and business operations formerly held by each
Founding Company will exist in a separate subsidiary of the Company.

Each of the merger agreements provides for the Company to pay the
stockholders of the Founding Company (i) a fixed amount of cash at the Closing
(subject to certain adjustments which have a neutral economic effect, as
discussed below), (ii) shares of Common Stock at the Closing having a fixed
dollar value, with the final number of shares being determined by the Offering
price, and (iii) with respect to six of the Founding Companies, shares of Common
Stock (the "Additional Consideration") deliverable after the Closing having a
value based on the initial public offering price up to a fixed dollar amount.
The Additional Consideration will be paid in shares of Common Stock, with the
number of those shares determined by a formula based on the relationship of the
EBIT of that Founding Company (including its successor following the Closing)
for the fiscal year ending June 30, 1998 to a specified EBIT target. For the
seventh Founding Company, Star, the stockholders will be entitled to receive
additional shares of Common Stock or cash in accordance with a formula based on
the amount by which the EBIT of Star and its successor following the Closing for
the fiscal year ending June 30, 1999 exceeds a specified EBIT target (the "Star
Contingent Consideration").

The aggregate consideration to be paid by the Company in the Combination
shown below consists of approximately $22.5 million in cash (prior to any
adjustments discussed in the following paragraph) and 3,826,815 shares of Common
Stock at the Closing, and up to a maximum of 1,325,000 shares of Common Stock as
Additional Consideration (assuming the achievement of certain EBIT targets)
following the end of fiscal 1998.

<TABLE>
<CAPTION>
AT CLOSING
------------------------------------------
SHARES ADDITIONAL CONSIDERATION
--------------------------- ---------------------------
FOUNDING COMPANY CASH (1) DOLLAR VALUE NUMBER (2) DOLLAR VALUE NUMBER (2)
- ----------------------------- ---------- ------------ ---------- ------------ ----------
<S> <C> <C> <C> <C> <C>
BTI.......................... $5,000,000 $ 5,848,656 487,388 $ 2,000,000 166,666
Decker....................... 1,550,000 4,533,333 377,778 3,000,000 250,000
J. Howard.................... 1,700,000 4,072,043 339,337 3,300,000 275,000
LSS.......................... 2,625,000 7,677,419 639,785 1,000,000 83,333
MOHR......................... 1,200,000 2,709,677 225,806 2,000,000 166,666
Novations.................... 4,987,500 8,887,097 740,592 4,600,000 383,333
Star......................... 5,400,000 12,193,548 1,016,129 * *
</TABLE>

- ---------------
* Excludes the Star Contingent Consideration.

(1) Prior to the adjustments discussed below.

(2) Assuming an initial public offering price of $12.00 per share.

Each of the mergers in the Combination is conditioned upon the applicable
Founding Company meeting certain specified financial standards as of the Closing
(which vary among the Founding Companies), including a specified minimum net
worth. If a Founding Company's net worth as of the Closing exceeds the specified
minimum, the cash portion of the purchase price set forth above will be
increased by a dollar amount equal to that excess. Each Founding Company may
make a cash dividend to its stockholders prior to the Closing so long as doing
so will not prevent such Founding Company from satisfying the financial
standards specified in its merger agreement.

The consideration to be paid for the Founding Companies was determined
through arm's length negotiations between Provant and representatives of each
Founding Company. The factors considered by the

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<PAGE> 56

parties in determining the consideration to be paid included, among others, the
pro forma adjusted EBIT, net worth and future prospects of the Founding
Companies.

In connection with the Combination, the following principals of the
Founding Companies who will become directors of the Company immediately
following the Closing will receive the following: Mr. Cohen, $600,000 and
112,903 shares of Common Stock (including cash and shares issued to his wife);
Mr. Decker, $833,092 and 203,047 shares of Common Stock; Dr. Green, $4,495,414
and 425,352 shares of Common Stock; Mr. Hanson, $498,750 and 74,059 shares of
Common Stock; Mr. King, $968,100 and 316,627 shares of Common Stock; Mr. von
Sternberg, $2,498,655 and 548,710 shares of Common Stock (including cash and
shares issued to his wife); and Mr. Wallace, $765,000 and 152,701 shares of
Common Stock.

The consummation of the Combination is subject to completion of the
Offering and customary conditions including, among others, the continuing
accuracy at the Closing of the representations and warranties made by the
Founding Companies and the Company in the merger agreements, receipt of all
necessary consents and approvals, delivery of opinions of counsel, the
performance of covenants included in the agreements relating to the Combination,
and the nonexistence of a material adverse change in the business, results of
operations or financial condition of each Founding Company. The merger
agreements provide that certain stockholders of the Founding Companies will
indemnify Provant against certain liabilities, including breaches of such
Founding Company's representations and warranties thereunder.

Pursuant to the agreements entered into in connection with the Combination,
the principal stockholders of the Founding Companies have agreed not to compete
with the Company for five years, commencing as of the Closing. In addition, the
principal stockholders and certain other employees of each of the Founding
Companies will enter into three-year employment agreements with the Company.
Each such agreement with a Founding Company's director nominee (i.e., Messrs.
Cohen, Decker, Green, Hanson, King, von Sternberg and Wallace) will provide for
an initial base salary of $175,000 (except for Mr. Decker's agreement which will
provide for a base salary of $125,000), subject to upward adjustment in the sole
discretion of the Company, and in most cases participation in the Company's
bonus and benefit plans. Each agreement may be terminated prior to the
expiration of the three-year term either in the event of disability or for cause
(as defined). If the individual does not continue to be employed by the Company
upon the expiration of the agreement, the individual shall be entitled to
receive six months' severance at his base salary as in effect at the time of
expiration.

Certain of the indebtedness of the Founding Companies currently is
personally guaranteed by their respective stockholders. The Company will repay
such indebtedness at the Closing, and the guarantees will be released. In
particular, the Company will repay amounts owed by Novations (which totalled
approximately $1.0 million as of September 30, 1997) and Star (which totalled
approximately $1.7 million as of September 30, 1997) which are personally
guaranteed by Messrs. Hanson and von Sternberg, respectively. In addition, the
Company will assume in the Combination indebtedness of the Founding Companies
that had an aggregate outstanding balance of $1.5 million as of September 30,
1997.

The former stockholders of the Founding Companies will agree that, for a
period of two years following the Closing, they will not sell any shares of
Common Stock received by them in connection with the Combination other than
pursuant to an effective registration statement under the Securities Act. The
Company has no obligation to provide such a registration statement but, in the
event the Company decides to register any shares received by any stockholder in
the Combination, or any shares of Common Stock issued or issuable pursuant to
options and warrants granted by Provant prior to the Closing, it must give each
of the Company's stockholders (giving effect to the Combination but not the
Offering) the opportunity to register a pro rata amount thereunder. In addition,
between the second and third anniversary of the Closing, these stockholders may
only sell such shares through a broker or brokers designated by the Company.

55
<PAGE> 57

OTHER TRANSACTIONS

Organization of Provant

In connection with the founding and organization of Provant, Messrs.
Verrochi, Zenger, Puopolo, Gardner, Davies and Donald W. Glazer purchased shares
of Common Stock for an aggregate purchase price of approximately $3,250. As a
result of such purchases, these individuals beneficially own the following: Mr.
Verrochi, 870,131 shares; Mr. Zenger, 262,678 shares; Mr. Puopolo, 802,762
shares; Mr. Gardner, 302,506 shares; Mr. Davies, 285,424 shares; and Mr. Glazer,
303,116 shares. Mr. Glazer will enter into a consulting agreement with the
Company having a term of two years from the Closing, and providing for an annual
consulting fee of $125,000.

American Business Partners LLC

During 1997, members of the management team and certain consultants were
assembled by American Business Partners LLC ("ABP") to pursue the consolidation
of companies in the training and development industry. Mr. Verrochi, Chairman of
the Board and Chief Executive Officer of the Company, and Mr. Puopolo, Executive
Vice President and Chief Financial Officer of the Company, are members of ABP.
ABP provided the Company with expertise regarding the consolidation process.

Expenses paid by the Company prior to the Closing in connection with the
Combination and the Offering have been financed with funds advanced to the
Company by Messrs. Verrochi and Puopolo. Outstanding advanced amounts bear
interest at an annual rate equal to the prime rate of interest as from time to
time published in The Wall Street Journal. The Company will repay certain of the
advanced amounts plus interest to Messrs. Verrochi and Puopolo at the Closing
out of the proceeds of the Offering. See "Use of Proceeds." As of December 31,
1997, Messrs. Verrochi and Puopolo had advanced approximately $1.0 million to
the Company for such expenses.

As partial consideration for their commitment to extend the financing
described above, Messrs. Verrochi and Puopolo each received two warrants. The
first warrant entitles the holder to purchase 176,368 shares of Common Stock at
a per share exercise price equal to the initial public offering price. The
second warrant entitles the holder to purchase 220,460 shares of Common Stock
which will become exercisable only if the market price of the Common Stock
increases to certain threshold levels (except as otherwise described below) (the
"Contingent Warrant"). Specifically, 20% of the total number of shares issuable
under the Contingent Warrant will become exercisable on each of the three
occasions that the market price of the Common Stock increases by 100%, 200%,
300%, respectively, from the initial public offering price, and the remaining
40% of the total number of shares issuable under the Contingent Warrant will
become exercisable if the market price of the Common Stock increases by 400%.
However, under certain circumstances involving the merger or sale of the
Company, the Contingent Warrant will become exercisable to purchase all of the
warrant shares. The exercise price of the Contingent Warrant increases on each
anniversary of the closing of the Offering. Specifically, the exercise price is
equal to the initial public offering price for the first 12 months following the
closing of the Offering and, for each 12 month period thereafter, is equal to
the initial public offering price plus 10% of the initial public offering price
multiplied by the number of full 12 month periods elapsed since the closing of
the Offering. However, once a portion of the Contingent Warrant becomes
exercisable, that portion's exercise price is fixed as of that date. All four
warrants expire on the seventh anniversary of the closing of the Offering. The
holders of the warrants have the right to require the Company to register the
resale of the shares that may be acquired upon exercise of the warrants under
the Securities Act.

In June 1997, Messrs. Verrochi and Puopolo sold to the Company furniture
and equipment for its corporate executive offices for an aggregate purchase
price of $150,000. The Company believes that the purchase price approximated the
fair market value of the furniture and equipment.

OTHER TRANSACTIONS INVOLVING OFFICERS AND DIRECTORS

Prior to the Offering, Provant had outstanding 2,978,790 shares of Common
Stock. All of such shares currently are beneficially owned by the proposed
management and directors of and consultants to Provant or

56
<PAGE> 58

members of their families. The holders of all such shares have agreed with the
Company that, for a period of two years following the Closing, they will not
sell any shares of Common Stock held by them as of the Closing (or that may be
purchased by them under options and warrants outstanding as of the Closing)
other than pursuant to an effective registration statement under the Securities
Act.

Michael J. Davies, who will become a director of the Company upon the
consummation of the Offering, also will become a full-time consultant to the
Company. For the performance of his consulting duties, Mr. Davies will be paid
an annual fee of $100,000. In addition, in consideration for his agreement to
become a consultant, Mr. Davies will receive, prior to the Closing, an option to
purchase 50,000 shares of Common Stock, which will become exercisable upon the
Closing for all of the shares issuable thereunder at a per share exercise price
equal to the initial public offering price. Mr. Davies currently is a consultant
to Provant. For information regarding option grants to individuals who will
become executive officers of the Company upon the Closing, see
"Management -- Equity Incentive Plan."

The Company intends to use $750,000 of the net proceeds of the Offering to
pay a fee due upon the Closing to Legg Mason Wood Walker, Incorporated for
proprietary information relating to the training and development industry
developed by Mr. Davies while he served as Managing Director at that company.
See "Use of Proceeds."

As a result of the Combination, the Company will become a party to a
six-year lease of administrative offices, effective January 1, 1996, from Paul
C. Green, Ph.D., who will become a director of the Company immediately after the
Closing. For the years ended June 30, 1995, 1996 and 1997, rent expense paid to
Dr. Green pursuant to the lease was approximately $90,000, $76,000 and $85,000,
respectively. The Company believes that the terms of the lease are no less
favorable to the Company than could be obtained by the Company from
non-affiliated third parties.

As a result of the Combination, the Company will become a party to a
five-year lease of office facilities renewable for an additional five years,
effective March 1997, from Novations Partners, L.L.C., a Utah limited liability
company (the "LLC") which is controlled by the stockholders of Novations. Joe
Hanson, one of the members of the LLC, will become a director of the Company
immediately after the Closing. The annual rent expense to be paid to the LLC is
$300,000 for the first year of the lease and increases 3% per year thereafter.
The Company believes that the terms of the lease are no less favorable to the
Company than could be obtained from non-affiliated third parties. In addition,
Novations has the right to receive amounts loaned by Novations to the LLC. The
balance due totalled approximately $192,000 as of September 30, 1997. All
outstanding amounts owed to Novations pursuant to these arrangements will be
paid by the LLC at or before the Closing.

A. Carl von Sternberg was indebted to Star during 1997 under a promissory
note. Mr. von Sternberg will become a director of the Company immediately after
the Closing. Borrowings by Mr. von Sternberg under the note totalled
approximately $344,000 as of September 30, 1997. Outstanding principal amounts
owed under the note accrue interest from time to time at the prime rate of
interest as reported in The Wall Street Journal. All principal amounts owed
under the note, together with accrued interest, will be repaid by Mr. von
Sternberg on or before the consummation of the Combination.

In December 1997, Marc S. Wallace, who will become a director of the
Company immediately after the Closing, incurred indebtedness to J. Howard
pursuant to two promissory notes in the aggregate principal amount of $75,000.
Outstanding principal amounts owed under the notes accrue interest from time to
time at an annual rate of 7.0%. The notes mature on May 31, 1998.

COMPANY POLICY

The Company's policy is that any future transactions with directors,
officers, employees or affiliates of the Company be approved in advance by a
majority of the Company's Board of Directors, including a majority of the
disinterested members of the Board, and be on terms no less favorable to the
Company than the Company could obtain from non-affiliated parties.

57
<PAGE> 59

DESCRIPTION OF CAPITAL STOCK

GENERAL

The Company's authorized capital stock consists of 45,000,000 shares of
capital stock, par value $.01 per share, consisting of 40,000,000 shares of
Common Stock and 5,000,000 shares of preferred stock (the "Preferred Stock").
Without giving effect to the issuance of shares in the Offering (but giving
effect to the Combination), the Company has outstanding 6,805,605 shares of
Common Stock held by 70 stockholders, and no shares of Preferred Stock.

COMMON STOCK

Immediately following the Combination and the Offering, the Company will
have outstanding 9,405,605 shares of Common Stock and options and warrants to
purchase an aggregate of 11,042,725 shares of Common Stock. A total of 1,100,000
shares of Common Stock are reserved for issuance under the Equity Incentive
Plan, 100,000 shares of Common Stock under the Directors' Plan and 500,000
shares of Common Stock under the Employee Stock Purchase Plan. Holders of Common
Stock are entitled to one vote for each share held of record on all matters
submitted to a vote of the stockholders, and do not have cumulative voting
rights. Subject to preferences that may be applicable to any outstanding shares
of Preferred Stock, holders of Common Stock are entitled to receive ratably such
dividends, if any, as may be declared from time to time by the Board of
Directors of the Company out of funds legally available therefor. See "Dividend
Policy." All outstanding shares of Common Stock are, and the shares to be issued
in the Combination and sold in the Offering when issued and paid for will be,
fully paid and nonassessable, and the holders thereof will have no preferences
or rights of conversion, exchange or pre-emption. In the event of any
liquidation, dissolution or winding-up of the affairs of the Company, holders of
Common Stock will be entitled to share ratably in the assets of the Company
remaining after payment or provision for payment of all of the Company's debts
and obligations and after liquidation payments to holders of outstanding shares
of Preferred Stock, if any.

PREFERRED STOCK

The Preferred Stock, if issued, would have priority over the Common Stock
with respect to dividends and other distributions, including the distribution of
assets upon liquidation. The Board of Directors has the authority, without
further stockholder authorization, to issue from time to time shares of
Preferred Stock in one or more series and to fix the terms, limitations,
relative rights and preferences and variations of each series. Although the
Company has no present plans to issue any shares of Preferred Stock following
the closing of the Offering, the issuance of shares of Preferred Stock, or the
issuance of rights to purchase such shares, could decrease the amount of
earnings and assets available for distribution to the holders of Common Stock,
could adversely affect the rights and powers, including voting rights, of the
Common Stock, and could have the effect of delaying, deterring or preventing a
change in control of the Company or an unsolicited acquisition proposal.

WARRANTS TO PURCHASE COMMON STOCK

The Company has issued warrants to Messrs. Verrochi and Puopolo, the terms
of which are more fully described in "Certain Transactions."

CERTAIN PROVISIONS

Special Meetings of the Stockholders of the Company. The Company's By-laws
provide that a special meeting of the stockholders of the Company only may be
called by the President, the Chairman of the Board or by order of the Board of
Directors. The By-laws do not authorize the stockholders to call a special
meeting of stockholders, potentially limiting the stockholders' ability to offer
proposals between annual meetings if no special meetings are otherwise called by
the President, Chairman or the Board.

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<PAGE> 60

No Action by Written Consent. The Company's Certificate of Incorporation
does not permit the Company's stockholders to act by written consent. As a
result, any action to be taken by the Company's stockholders must be taken at a
duly called meeting of the stockholders.

STATUTORY BUSINESS COMBINATIONS PROVISION

The Company is subject to the provisions of Section 203 of the DGCL
("Section 203"). Section 203 provides, with certain exceptions, that a Delaware
corporation may not engage in any of a broad range of business combinations with
a person, or an affiliate or associate of such a person, who is an "interested
stockholder" for a period of three years from the date that such person became
an interested stockholder unless: (i) the transaction resulting in a person
becoming an interested stockholder, or the business combination, is approved by
the Board of Directors of the corporation before the person becomes an
interested stockholder; (ii) the interested stockholder acquired 85% or more of
the outstanding voting stock of the corporation in the same transaction that
makes such person an interested stockholder (excluding shares owned by persons
who are both officers and directors of the corporation, and shares held by
certain employee stock ownership plans); or (iii) on or after the date the
person becomes an interested stockholder, the business combination is approved
by the corporation's board of directors and by the holders of at least 66 2/3%
of the corporation's outstanding voting stock at an annual or special meeting,
excluding shares owned by the disinterested stockholder. Under Section 203, an
"interested stockholder" is defined as any person who is (i) the owner of 15% or
more of the outstanding voting stock of the corporation or (ii) an affiliate or
associate of the corporation and who was the owner of 15% or more of the
outstanding voting stock of the corporation at any time within the three-year
period immediately prior to the date on which it is sought to be determined
whether such person is an interested stockholder.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Company will be selected prior to
the closing of the Offering.

SHARES ELIGIBLE FOR FUTURE SALE

Upon the consummation of the Combination and the Offering, the Company will
have 9,405,605 shares of Common Stock issued and outstanding, and 1,637,120
shares of Common Stock issuable upon the exercise of outstanding options and
warrants. Of these shares, 2,600,000 shares sold pursuant to the Offering (or
2,990,000 shares, if the Underwriters' over-allotment option is exercised in
full) will be freely tradeable without restriction under the Securities Act,
except any shares purchased by an "affiliate" (as that term is defined under the
rules and regulations of the Securities Act) of the Company, which shares will
be subject to the resale limitations of Rule 144 of the Securities Act. The
remaining shares outstanding upon completion of the Offering may be resold
publicly only upon registration under the Securities Act or in compliance with
an exemption from the registration requirements of the Securities Act, including
the exemption provided by Rule 144.

In general, under Rule 144, if a period of at least one year has elapsed
between the later of the date on which restricted securities were acquired from
the Company and the date on which they were acquired from an affiliate, then the
holder of such restricted securities (including an affiliate) is entitled to
sell that number of shares within any three-month period that does not exceed
the greater of (i) one percent of the then outstanding shares of Common Stock or
(ii) the average weekly reported volume of trading of Common Stock during the
four calendar weeks preceding such sale. Any shares of Common Stock issued as
Additional Consideration and Star Contingent Consideration will be deemed to
have been acquired at the Closing for purposes of Rule 144. Sales under Rule 144
also are subject to certain requirements pertaining to the manner of sales,
notices of sales and the availability of current public information concerning
the Company. Any shares not constituting restricted securities sold by
affiliates must be sold in accordance with the foregoing volume limitations and
other requirements but without regard to the one year holding period. Under Rule
144(k), if a period of at least two years has elapsed from the later of the date
on which restricted securities were acquired from the Company and the date on
which they were acquired from the affiliate, a

59
<PAGE> 61

holder of such restricted securities who is not an affiliate at the time of the
sale and has not been an affiliate for at least three months prior to the sale
would be entitled to sell the shares immediately without regard to the volume
limitations and other conditions described above.

The Company and the holders of all shares outstanding prior to the Offering
(including the holders of shares issued in connection with the Combination) have
agreed with the Representatives of the Underwriters not to offer, sell, contract
to sell or otherwise dispose of any shares of Common Stock, or any securities
convertible into or exercisable or exchangeable for shares of Common Stock, for
a period of 180 days after the date of this Prospectus (the "Lock-up Period")
without the prior written consent of the Representatives, except for: (i) in the
case of the Company, Common Stock issued pursuant to the Company's Equity
Incentive Plan, Directors' Plan and Employee Stock Purchase Plan or in
connection with acquisitions; and (ii) in the case of all such holders, the
exercise of stock options pursuant to the benefit plans described herein and
shares of Common Stock disposed of as bona fide gifts, subject, in each case, to
any remaining portion of the Lock-up Period applying to any shares so issued or
transferred. In evaluating any request for a waiver of the Lock-up Period,
NationsBanc Montgomery Securities LLC will consider, in accordance with its
customary practice, all relevant facts and circumstances at the time of the
request, including, without limitation, the recent trading market for the Common
Stock, the size of the request and, with respect to a request by the Company to
issue additional equity securities, the purpose of such an issuance. See
"Underwriting." In addition, the stockholders of the Founding Companies and all
stockholders of the Company prior to the Offering have agreed to certain
transfer restrictions for a two-year period on all shares of Common Stock held
or to be held by them. See "Certain Transactions -- Organization of the Company"
and "-- Other Transactions Involving Officers and Directors."

In the aggregate, 100,000 shares of Common Stock are reserved for issuance
under the Directors' Plan, 1,100,000 shares are reserved for issuance under the
Equity Incentive Plan and 500,000 shares are reserved for issuance under the
Employee Stock Purchase Plan. The Company presently intends to file a
registration statement under the Securities Act to register Common Stock to be
issued pursuant to the exercise of options or stock granted or to be granted
under the Directors' Plan, Equity Incentive Plan and Employee Stock Purchase
Plan. Common Stock issued after the effective date of such registration
statement upon the exercise of such options (or the purchase of Common Stock
under the Employee Stock Purchase Plan) would be available for immediate resale
in the open market, subject to compliance with Rule 144 in the case of
affiliates.

Prior to the Offering, there has been no public market for the Common Stock
of the Company, and no predictions can be made of the effect, if any, that the
availability of shares for sale or the actual sale of shares will have on market
prices prevailing from time to time. Sales or the availability for sale of
substantial amounts of Common Stock in the public market could adversely affect
prevailing market prices and the ability of the Company to raise equity capital
in the future.

After the Closing, the Company plans to register an additional 3,000,000
shares of Common Stock under the Securities Act for use as consideration for
future acquisitions. Any such shares issued by the Company to affiliates of
companies acquired by the Company will be subject for one year after the
acquisition to the limitations and restrictions on resale imposed by Rule 145
under the Securities Act.

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<PAGE> 62

UNDERWRITING

The underwriters named below (the "Underwriters"), represented by
NationsBanc Montgomery Securities LLC, Salomon Smith Barney and Piper Jaffray
Inc. (the "Representatives"), have severally agreed, subject to the terms and
conditions in the underwriting agreement (the "Underwriting Agreement") by and
among the Company and the Underwriters, to purchase from the Company the number
of shares of Common Stock indicated below opposite its name, at the initial
public offering price less the underwriting discount set forth on the cover page
of this Prospectus. The Underwriting Agreement provides that the obligations of
the Underwriters are subject to certain conditions precedent and that the
Underwriters are committed to purchase all of the shares of Common Stock, if
they purchase any.

<TABLE>
<CAPTION>
UNDERWRITERS NUMBER OF SHARES
------------------------------------------------------------- ----------------
<S> <C>
NationsBanc Montgomery Securities LLC........................
Smith Barney Inc.............................................
Piper Jaffray Inc............................................
-------
Total.............................................. 2,600,000
=======
</TABLE>

The Representatives have advised the Company that the Underwriters propose
initially to offer the Common Stock to the public on the terms set forth on the
cover page of this Prospectus. The Underwriters may allow selected dealers a
concession of not more than $ per share; and the Underwriters may
allow, and such dealers may reallow, a concession of not more than $
per share to certain other dealers. After the initial public offering, the
public offering price and other selling terms may be changed by the
Representatives. The Common Stock is offered subject to receipt and acceptance
by the Underwriters, and to certain other conditions, including the right to
reject orders in whole or in part.

The Company has granted an option to the Underwriters, exercisable during
the 30-day period after the date of this Prospectus, to purchase up to a maximum
of 390,000 additional shares of Common Stock to cover over-allotments, if any,
at the same price per share as the initial shares to be purchased by the
Underwriters. To the extent that the Underwriters exercise such over-allotment
option, the Underwriters will be committed, subject to certain conditions, to
purchase such additional shares in approximately the same proportion as set
forth in the above table. The Underwriters may purchase such shares only to
cover over-allotments made in connection with the Offering.

The Underwriting Agreement provides that the Company, its subsidiaries and
certain stockholders of the Founding Companies will indemnify the Underwriters
against certain liabilities, including civil liabilities under the Securities
Act, or will contribute to payments the Underwriters may be required to make in
respect thereof.

The Company's officers and directors and all of the stockholders of the
Company prior to the Offering (including the holders of shares issued in
connection with the Combination) have agreed that during the Lock-up Period they
will not, without the prior written consent of NationsBanc Montgomery Securities
LLC, directly or indirectly sell, offer, contract or grant any option to sell,
pledge, transfer, establish an open put equivalent position or otherwise dispose
of any shares of Common Stock, options or warrants to acquire shares of Common
Stock or securities exchangeable or exercisable for or convertible into shares
of Common Stock. The Company also has agreed not to issue, offer, sell, grant
options to purchase or otherwise dispose of any of the Company's equity
securities during the Lock-up Period without the prior written consent of
NationsBanc Montgomery Securities LLC, except for securities issued by the
Company in connection with acquisitions and for grants and exercises of stock
options, subject in each case to any remaining portion of the Lock-up Period
applying to shares issued or transferred. In evaluating any request for a waiver
of the Lock-up Period, NationsBanc Montgomery Securities LLC will consider, in
accordance with their customary practice, all relevant facts and circumstances
at the time of the request, including, without limitation, the recent trading
market for the Common Stock, the size of the request, and, with respect to a
request by the Company to issue additional equity securities, the purpose of
such an issuance. See "Shares Eligible for Future Sale."

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<PAGE> 63

In connection with the Offering, certain Underwriters and selling group
members and their respective affiliates may engage in transactions that
stabilize, maintain or otherwise affect the market price of the Common Stock.
Such transactions may include stabilization transactions effected in accordance
with Rule 104 of Regulation M under the Securities Exchange Act of 1934 (the
"Exchange Act"), pursuant to which such persons may bid for or purchase Common
Stock for the purpose of stabilizing its market price. The Underwriters also may
create a short position for the account of the Underwriters by selling more
Common Stock in connection with the Offering than they are committed to purchase
from the Company and, in such case, may purchase Common Stock in the open market
following completion of the Offering to cover all or a portion of such short
position. The Underwriters may also cover all or a portion of such short
position, up to 390,000 shares of Common Stock, by exercising the Underwriters'
over-allotment option referred to above. In addition, NationsBanc Montgomery
Securities LLC, on behalf of the Underwriters, may impose "penalty bids" under
contractual arrangements with the Underwriters whereby it may reclaim from an
Underwriter (or dealer participating in the Offering), for the account of the
other Underwriters, the selling concession with respect to Common Stock that is
distributed in the Offering but subsequently purchased for the account of the
Underwriters in the open market. Any of the transactions described in this
paragraph may result in the maintenance of the price of the Common Stock at a
level above that which might otherwise prevail in the open market. None of the
transactions described in this paragraph is required, and, if they are
undertaken, they may be discontinued at any time.

The Representatives have informed the Company that the Underwriters do not
expect to make sales of Common Stock offered by this Prospectus to accounts over
which they exercise discretionary authority in excess of 5% of the number of
shares of Common Stock offered hereby.

Prior to the Offering, there has been no public trading market for the
Common Stock. Consequently, the initial public offering price of the Common
Stock will be determined by negotiations between the Company and the
Representatives. Among the factors to be considered in such negotiations will be
the results of operations of the Founding Companies in recent periods, the
prospects for the Company and the industry in which the Company competes, an
assessment of the Company's management, its financial condition, the prospects
for future earnings of the Company, the present state of the Company's
development, the general condition of the economy and the securities markets at
the time of the Offering and the market prices of and demand for publicly traded
common stock of comparable companies in recent periods.

LEGAL MATTERS

The validity of the shares of Common Stock offered by this Prospectus will
be passed upon for the Company by Nutter, McClennen & Fish, LLP, Boston,
Massachusetts. Certain legal matters related to the Offering will be passed upon
for the Underwriters by Ropes & Gray, Boston, Massachusetts.

EXPERTS

The financial statements of Provant, Inc. as of June 30, 1997 and for the
period from November 16, 1996 (date of inception) to June 30, 1997, and the
financial statements of Behavioral Technology, Inc., Decker Communications,
Inc., J. Howard & Associates, Inc., Robert Steinmetz, Ph.D., and Associates,
Inc. d/b/a Learning Systems Sciences, MOHR Retail Learning Systems, Inc. and
Novations Group, Inc., have been included herein and in the Registration
Statement in reliance on the reports of KPMG Peat Marwick LLP, independent
certified public accountants, appearing elsewhere herein, upon the authority of
said firm as experts in giving said reports.

The consolidated financial statements of Star Mountain, Inc. and
subsidiaries included in this Prospectus, to the extent of and for the periods
indicated in the report, have been audited by Friedman & Fuller, P.C.,
independent public accountants, as indicated in its report with respect thereto,
and are included herein in reliance upon the authority of said firm as experts
in giving said reports.

62
<PAGE> 64

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-1 (including any and all
amendments thereto, the "Registration Statement") under the Securities Act and
the rules and regulations promulgated thereunder, with respect to the Common
Stock offered hereby. This Prospectus omits certain information contained in the
Registration Statement, and reference is made to the Registration Statement and
the exhibits and schedules thereto for further information with respect to the
Company and the Common Stock offered hereby. Statements contained in this
Prospectus concerning the provisions or contents of any contract, agreement or
any other document referred to herein are not necessarily complete with respect
to each such contract, agreement or document filed as an exhibit to the
Registration Statement, and reference is made to such exhibit for a more
complete description of the matters involved, and each such statement shall be
deemed qualified by such reference. Upon completion of the Offering, the Company
will be subject to the information requirements of the Exchange Act, and in
accordance therewith will file reports, proxy statements and other information
with the Commission. Such reports, proxy statements and other information, as
well as the Registration Statement, including the exhibits and schedules
thereto, may be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the regional offices of the Commission
located at 7 World Trade Center, 13th Floor, New York, New York 10048 and at 500
West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
materials may be obtained from such offices, upon payment of the fees prescribed
by the Commission. The Commission maintains a Web site (http://www.sec.gov) that
contains reports, proxy and information statements and other information
regarding registrants that submit electronic filings to the Commission.

The Company intends to furnish its stockholders with annual reports
containing audited consolidated financial statements and an opinion thereon
expressed by an independent public accounting firm, and with quarterly reports
for the first three quarters of each fiscal year containing unaudited interim
consolidated financial information.

63
<PAGE> 65

INDEX TO FINANCIAL STATEMENTS

UNAUDITED PRO FORMA COMBINED FINANCIAL DATA

HISTORICAL FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
PROVANT, INC. PRO FORMA:
Basis of Presentation............................................................... F-3
Unaudited Pro Forma Combined Balance Sheet.......................................... F-4
Unaudited Pro Forma Combined Statements of Operations............................... F-5
Notes to Unaudited Pro Forma Combined Financial Statements.......................... F-7

PROVANT, INC.:
Independent Auditors' Report........................................................ F-12
Balance Sheets...................................................................... F-13
Statements of Operations............................................................ F-14
Statements of Stockholders' Equity.................................................. F-15
Statements of Cash Flows............................................................ F-16
Notes to Financial Statements....................................................... F-17

BEHAVIORAL TECHNOLOGY, INC.:
Independent Auditors' Report........................................................ F-21
Balance Sheets...................................................................... F-22
Statements of Operations............................................................ F-23
Statements of Stockholders' Equity.................................................. F-24
Statements of Cash Flows............................................................ F-25
Notes to Financial Statements....................................................... F-26

DECKER COMMUNICATIONS, INC.:
Independent Auditors' Report........................................................ F-29
Balance Sheets...................................................................... F-30
Statements of Operations............................................................ F-31
Statements of Stockholders' Equity.................................................. F-32
Statements of Cash Flows............................................................ F-33
Notes to Financial Statements....................................................... F-34

J. HOWARD & ASSOCIATES, INC.:
Independent Auditors' Report........................................................ F-38
Balance Sheets...................................................................... F-39
Statements of Operations............................................................ F-40
Statements of Stockholders' Equity.................................................. F-41
Statements of Cash Flows............................................................ F-42
Notes to Financial Statements....................................................... F-43

LEARNING SYSTEMS SCIENCES (ROBERT STEINMETZ, PH.D., AND
ASSOCIATES, INC. ):
Independent Auditors' Report........................................................ F-47
Balance Sheets...................................................................... F-48
Statements of Operations............................................................ F-49
Statements of Stockholders' Equity.................................................. F-50
Statements of Cash Flows............................................................ F-51
Notes to Financial Statements....................................................... F-52
</TABLE>

F-1
<PAGE> 66

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
MOHR RETAIL LEARNING SYSTEMS, INC.:
Independent Auditors' Report........................................................ F-55
Balance Sheets...................................................................... F-56
Statements of Operations............................................................ F-57
Statements of Stockholders' Equity.................................................. F-58
Statements of Cash Flows............................................................ F-59
Notes to Financial Statements....................................................... F-60

NOVATIONS GROUP, INC.:
Independent Auditors' Report........................................................ F-63
Balance Sheets...................................................................... F-64
Statements of Operations............................................................ F-65
Statements of Stockholders' Equity.................................................. F-66
Statements of Cash Flows............................................................ F-67
Notes to Financial Statements....................................................... F-68

STAR MOUNTAIN, INC.:
Independent Auditors' Report........................................................ F-71
Consolidated Balance Sheets......................................................... F-72
Consolidated Statements of Operations............................................... F-73
Consolidated Statements of Stockholders' Equity..................................... F-74
Consolidated Statements of Cash Flows............................................... F-75
Notes to Consolidated Financial Statements.......................................... F-77
</TABLE>

F-2
<PAGE> 67

PROVANT, INC. AND FOUNDING COMPANIES

UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
BASIS OF PRESENTATION

The following unaudited pro forma combined financial statements give effect
to (i) the Combination of Provant and the Founding Companies, (ii) the
consummation of the Offering and the application of the net proceeds therefrom
and (iii) certain other adjustments described below and in the notes to the
unaudited pro forma combined financial statements. See "Combination" and "Use of
Proceeds" included elsewhere herein. In the Combination, subsidiaries of Provant
are merging with the following Founding Companies: Behavioral Technology, Inc.,
Decker Communications, Inc., J. Howard & Associates, Inc., MOHR Retail Learning
Systems, Inc., Novations Group, Inc., Robert Steinmetz, Ph.D., and Associates,
Inc., d/b/a Learning Systems Sciences and Star Mountain, Inc. The Combination
will occur simultaneously with the closing of the Offering and will be accounted
for using the purchase method of accounting. Provant has been identified as the
accounting acquiror in accordance with Securities and Exchange Commission Staff
Accounting Bulletin No. 97. These pro forma statements are based on the
historical financial statements of the Founding Companies included elsewhere in
this Prospectus and the estimates and assumptions set forth below and in the
notes to the unaudited pro forma combined financial statements.

The unaudited pro forma combined balance sheet gives effect to the
Combination and the Offering as if they had occurred on September 30, 1997. The
unaudited pro forma combined statements of operations give effect to these
transactions as if they had occurred on July 1, 1996.

Provant has preliminarily analyzed the benefits that it expects to realize
from reductions in salaries and certain benefits to the owners of the Founding
Companies. To the extent these owners have agreed prospectively to reductions in
salary, bonuses and benefits, these reductions have been reflected in the pro
forma combined statements of operations. With respect to other potential
benefits, Provant cannot quantify these benefits until completion of the
Combination. It is anticipated that these benefits will be offset by costs
related to the Company's new corporate management and by the costs associated
with being a public company. However, because these costs cannot be accurately
quantified at this time, they have not been included in the pro forma financial
information of Provant.

The pro forma adjustments are based on estimates, available information and
certain assumptions and may be revised as additional information becomes
available. The unaudited pro forma combined financial data presented herein does
not purport to represent what the Company's financial position or results of
operations actually would have been had such events occurred at the beginning of
the periods presented, as assumed, or to project the Company's financial
position or results of operations for any future period or the future results of
the Founding Companies. The unaudited pro forma combined financial statements
should be read in conjunction with the historical financial statements of
Provant and the Founding Companies and the related notes thereto included
elsewhere in this Prospectus. Also see "Risk Factors" included elsewhere herein.

F-3
<PAGE> 68

PROVANT, INC. AND FOUNDING COMPANIES

UNAUDITED PRO FORMA COMBINED BALANCE SHEET

SEPTEMBER 30, 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
BTI DECKER J. HOWARD LSS MOHR NOVATIONS STAR PROVANT TOTAL
------ ------ --------- ------ ---- --------- ------ ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Assets
Current assets:
Cash and cash equivalents............... $1,188 $ 526 $ 811 $ 508 $211 $ 446 $ 275 $ 3 $ 3,968
Investments............................. -- 932 -- -- -- -- -- -- 932
Accounts receivable, net................ 1,655 1,441 1,350 697 441 2,364 4,573 -- 12,521
Inventory............................... -- -- -- -- 132 -- 151 -- 283
Due from related parties................ -- 290 52 -- -- 341 344 -- 1,027
Costs in excess of billings............. -- -- -- 359 -- -- -- -- 359
Prepaid expenses and other current
assets................................ 160 102 50 56 22 50 164 143 747
------ ------ ------ ------ ----- ------ ---- ---- -------
Total current assets.............. 3,003 3,291 2,263 1,620 806 3,201 5,507 146 19,837
Property and equipment, net............... 117 359 290 153 46 456 852 153 2,426
Other assets.............................. 9 59 44 105 -- -- 1,928 50 2,195
Goodwill.................................. -- -- -- -- -- -- -- -- --
------ ------ ------ ------ ----- ------ ---- ---- -------
Total assets...................... $3,129 $3,709 $ 2,597 $1,878 $852 $ 3,657 $8,287 $ 349 $24,458
====== ====== ====== ====== ===== ====== ==== ==== =======
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable........................ $ 267 $ 284 $ 116 $ 97 $143 $ 174 $1,645 $ -- $ 2,726
Accrued expenses........................ 186 459 95 174 304 135 814 -- 2,167
Accrued compensation.................... 484 849 97 100 12 1,270 -- -- 2,812
Payable to stockholder/affiliate........ -- -- -- -- -- -- -- 560 560
Billings in excess of costs............. -- -- -- 362 -- -- 1,269 -- 1,631
Deferred revenue........................ 15 114 24 -- 98 -- -- -- 251
State income taxes...................... -- 62 38 -- -- -- -- -- 100
Distributions payable................... -- -- 125 -- -- -- -- -- 125
Current portion of long-term debt....... -- 410 -- -- -- 1,078 1,492 -- 2,980
------ ------ ------ ------ ----- ------ ---- ---- -------
Total current liabilities......... 952 2,178 495 733 557 2,657 5,220 560 13,352
Long-term debt, net of current portion.... -- 615 -- -- -- 361 505 -- 1,481
Deferred tax liability.................... -- -- -- -- -- -- -- -- --
------ ------ ------ ------ ----- ------ ---- ---- -------
Total liabilities................. 952 2,793 495 733 557 3,018 5,725 560 14,833
Redeemable common stock................... -- 300 -- -- -- -- -- -- 300
Stockholders' equity:
Common stock............................ 1 313 272 3 4 1 2,102 -- 2,696
Additional paid-in capital.............. 182 -- -- -- -- -- -- 3 185
Translation adjustments................. (6) -- -- -- -- -- -- -- (6)
Unrealized gain on short-term
investments........................... -- 9 -- -- -- -- -- -- 9
Note receivable from stock sales........ -- (171) -- -- -- -- -- -- (171)
Retained earnings....................... 2,000 465 1,830 1,142 291 638 1,086 (214) 7,238
Treasury stock.......................... -- -- -- -- -- -- (626) -- (626)
------ ------ ------ ------ ----- ------ ---- ---- -------
Total stockholders' equity........ 2,177 616 2,102 1,145 295 639 2,562 (211) 9,325
------ ------ ------ ------ ----- ------ ---- ---- -------
Total liabilities and
stockholders' equity............ $3,129 $3,709 $ 2,597 $1,878 $852 $ 3,657 $8,287 $ 349 $24,458
====== ====== ====== ====== ===== ====== ==== ==== =======

<CAPTION>
COMBINATION PRO FORMA OFFERING
ADJUSTMENTS COMBINED ADJUSTMENTS AS ADJUSTED
----------- --------- ----------- -----------
(NOTE 3) (NOTE 3)
<S> <C> <C> <C> <C>
Assets
Current assets:
Cash and cash equivalents............... $ (943) $ 3,025 $ (357) $ 2,668
Investments............................. -- 932 -- 932
Accounts receivable, net................ -- 12,521 -- 12,521
Inventory............................... -- 283 -- 283
Due from related parties................ 2,564 3,591 -- 3,591
Costs in excess of billings............. -- 359 -- 359
Prepaid expenses and other current
assets................................ -- 747 -- 747
------- ------- -------- --------
Total current assets.............. 1,621 21,458 (357) 21,101
Property and equipment, net............... -- 2,426 -- 2,426
Other assets.............................. (34) 2,161 -- 2,161
Goodwill.................................. 49,050 49,050 -- 49,050
------- ------- -------- --------
Total assets...................... $50,637 $75,095 $ (357) $74,738
======= ======= ======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable........................ $ -- $ 2,726 $ -- $ 2,726
Accrued expenses........................ -- 2,167 -- 2,167
Accrued compensation.................... -- 2,812 -- 2,812
Payable to stockholder/affiliate........ 22,463 23,023 (23,023) --
Billings in excess of costs............. -- 1,631 -- 1,631
Deferred revenue........................ -- 251 -- 251
State income taxes...................... -- 100 -- 100
Distributions payable................... -- 125 -- 125
Current portion of long-term debt....... -- 2,980 (2,900) 80
------- ------- -------- --------
Total current liabilities......... 22,463 35,815 (25,923) 9,892
Long-term debt, net of current portion.... -- 1,481 -- 1,481
Deferred tax liability.................... 1,276 1,276 -- 1,276
------- ------- -------- --------
Total liabilities................. 23,739 38,572 (25,923) 12,649
Redeemable common stock................... (300) -- -- --
Stockholders' equity:
Common stock............................ (2,658) 38 26 64
Additional paid-in capital.............. 36,514 36,699 26,290 62,989
Translation adjustments................. 6 -- -- --
Unrealized gain on short-term
investments........................... (9) -- -- --
Note receivable from stock sales........ 171 -- -- --
Retained earnings....................... (7,452) (214) (750) (964)
Treasury stock.......................... 626 -- -- --
------- ------- -------- --------
Total stockholders' equity........ 27,198 36,523 25,566 62,089
------- ------- -------- --------
Total liabilities and
stockholders' equity............ $50,637 $75,095 $ (357) $74,738
======= ======= ======== ========
</TABLE>

See accompanying notes to unaudited pro forma combined financial statements.

F-4
<PAGE> 69

PROVANT, INC. AND FOUNDING COMPANIES

UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

YEAR ENDED JUNE 30, 1997
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
BTI DECKER J. HOWARD LSS MOHR NOVATIONS STAR PROVANT
------ ------ --------- ------ --------- ---------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total revenue...................... $7,096 $8,410 $ 7,317 $5,599 $ 3,015 $9,018 $20,790 $ --
Cost of revenue.................... 1,488 2,275 2,160 1,928 825 4,839 12,602 --
------- ------ ------ ------ ------ ------ ------ ------
Gross profit............. 5,608 6,135 5,157 3,671 2,190 4,179 8,188 --
Selling, general and administrative
expenses......................... 5,111 5,621 4,555 3,061 1,745 3,315 7,061 149
Goodwill amortization.............. -- -- -- -- -- -- -- --
------- ------ ------ ------ ------ ------ ------ ------
Income from operations... 497 514 602 610 445 864 1,127 (149)
Other income (expense), net........ 40 -- 4 -- -- -- -- --
Interest income (expense).......... 31 (9) 26 14 3 (137) (53) --
------- ------ ------ ------ ------ ------ ------ ------
Income before income
taxes.................. 568 505 632 624 448 727 1,074 (149)
Provision (benefit) for income
taxes............................ -- 33 8 9 7 20 429 (60)
------- ------ ------ ------ ------ ------ ------ ------
Net income (loss)........ $ 568 $ 472 $ 624 $ 615 $ 441 $ 707 $ 645 $ (89)
======= ====== ====== ====== ====== ====== ====== ======
Net income per share...............
Shares used in computing net income
per share (Note 5)...............

<CAPTION>
COMBINATION PRO FORMA
TOTAL ADJUSTMENTS COMBINED
------- ----------- ----------
(NOTE 4)
<S> <C> <C> <C>
Total revenue...................... $61,245 $ 7,601 $ 68,846
Cost of revenue.................... 26,117 4,850 30,967
------- ------- -------
Gross profit............. 35,128 2,751 37,879
Selling, general and administrative
expenses......................... 30,618 (1,955) 28,663
Goodwill amortization.............. -- 1,226 1,226
------- ------- -------
Income from operations... 4,510 3,480 7,990
Other income (expense), net........ 44 -- 44
Interest income (expense).......... (125) 8 (117)
------- ------- -------
Income before income
taxes.................. 4,429 3,488 7,917
Provision (benefit) for income
taxes............................ 446 3,257 3,703
------- ------- -------
Net income (loss)........ $ 3,983 $ 231 $ 4,214
======= ======= =======
Net income per share............... $ 0.45
=======
Shares used in computing net income
per share (Note 5)............... 9,405,605
==========
</TABLE>

See accompanying notes to unaudited pro forma combined financial statements.

F-5
<PAGE> 70

PROVANT, INC. AND FOUNDING COMPANIES

UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 1997
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
BTI DECKER J. HOWARD LSS MOHR NOVATIONS STAR PROVANT
------ --------- --------- ------ --------- --------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total revenue...................... $1,977 $ 2,585 $ 1,917 $1,050 $ 556 $ 2,464 $5,770 $ --
Cost of revenue.................... 385 660 661 509 204 1,197 3,384 --
------ ------ ------ ------ ------ ------ ----- ------
Gross profit............. 1,592 1,925 1,256 541 352 1,267 2,386 --
Selling, general and administrative
expenses......................... 1,306 1,663 1,199 589 562 1,088 1,890 200
Goodwill amortization.............. -- -- -- -- -- -- -- --
------ ------ ------ ------ ------ ------ ----- ------
Income (loss) from
operations............. 286 262 57 (48) (210) 179 496 (200)
Other income (expense), net........ -- -- (3) -- -- -- -- --
Interest income (expense).......... 7 (3) 5 5 3 (83) 56 (8)
------ ------ ------ ------ ------ ------ ----- ------
Income (loss) before
income taxes........... 293 259 59 (43) (207) 96 552 (208)
Provision for income taxes......... -- 2 1 2 1 11 206 (83)
------ ------ ------ ------ ------ ------ ----- ------
Net income (loss)........ $ 293 $ 257 $ 58 $ (45) $(208) $ 85 $ 346 $ (125)
====== ====== ====== ====== ====== ====== ===== ======
Net income per share...............
Shares used in computing net income
per share (Note 5)...............

<CAPTION>
COMBINATION PRO FORMA
TOTAL ADJUSTMENTS COMBINED
------- ----------- ----------
(NOTE 4)
<S> <C> <C> <C>
Total revenue...................... $16,319 $ 1,419 $ 17,738
Cost of revenue.................... 7,000 1,056 8,056
------- ------ ---------
Gross profit............. 9,319 363 9,682
Selling, general and administrative
expenses......................... 8,497 (178) 8,319
Goodwill amortization.............. -- 307 307
------- ------ ---------
Income (loss) from
operations............. 822 234 1,056
Other income (expense), net........ (3) -- (3)
Interest income (expense).......... (18) 44 26
------- ------ ---------
Income (loss) before
income taxes........... 801 278 1,079
Provision for income taxes......... 140 418 558
------- ------ ---------
Net income (loss)........ $ 661 $ (140) $ 521
======= ====== =========
Net income per share............... $ 0.06
=========
Shares used in computing net income
per share (Note 5)............... 9,405,605
=========
</TABLE>

See accompanying notes to unaudited pro forma combined financial statements.

F-6
<PAGE> 71

PROVANT, INC. AND FOUNDING COMPANIES

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

(1) GENERAL

Concurrently with and as a condition to the closing of the Offering,
Provant will acquire the seven Founding Companies in the Combination. The
acquisitions will be accounted for using the purchase method of accounting with
Provant being treated as the accounting acquiror.

The historical financial statements reflect the financial position and
results of operations of the Founding Companies and were derived from the
respective Founding Companies' financial statements where indicated. The periods
included in these financial statements for the individual Founding Companies are
as of and for the three months ended September 30, 1997 and for the year ended
June 30, 1997. The audited historical financial statements included elsewhere
herein have been included in accordance with Securities and Exchange Commission
Staff Accounting Bulletin No. 80.

(2) ACQUISITION OF FOUNDING COMPANIES

The following table sets forth the consideration to be paid (i) in cash and
(ii) in shares of Common Stock to the stockholders of each of the Founding
Companies. For purposes of computing the estimated purchase price for accounting
purposes, the value of the shares is determined using an estimated fair value of
$9.60 per share, which represents a discount of 20% from the assumed initial
public offering price of $12.00 due to restrictions on the sale and
transferability of the shares issued. The total estimated value of the
consideration of $59.2 million for the acquisitions is based upon preliminary
estimates and is subject to certain purchase price adjustments at the closing.

<TABLE>
<CAPTION>
COMMON STOCK
-----------------------------
CASH SHARES VALUE OF SHARES
------- --------- ---------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
BTI............................................. $ 5,000 487,388 $ 4,679
Decker.......................................... 1,550 377,778 3,626
J. Howard....................................... 1,700 339,337 3,257
LSS............................................. 2,625 639,785 6,142
MOHR............................................ 1,200 225,806 2,168
Novations....................................... 4,988 740,592 7,110
Star............................................ 5,400 1,016,129 9,755
------- --------- -------
Total................................. $22,463 3,826,815 $36,737
======= ========= =======
</TABLE>

(3) UNAUDITED PRO FORMA COMBINED BALANCE SHEET ADJUSTMENTS

(a) Records the distributions estimated at $1.4 million which are expected
to be paid from cash on hand by certain Founding Companies prior to the
Closing of the Combination.

(b) Records the liability for the cash portion of the consideration to be
paid to the stockholders of the Founding Companies in connection with
the Combination.

(c) Reflects the creation of approximately $49.1 million of goodwill from
the payment of the Common Stock and cash consideration for the Founding
Companies totaling approximately $59.2 million (see note 2) less net
assets of the Founding Companies of approximately $10.2 million.

(d) Records the deferred income taxes attributable to the temporary
differences between the financial reporting and tax basis of assets and
liabilities held in S corporations.

(e) Records the receipt of cash from certain stockholders in satisfaction
of certain receivables and transfer of certain assets.

F-7
<PAGE> 72

PROVANT, INC. AND FOUNDING COMPANIES

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

(f) Records the aggregate receivable from the stockholders of the Founding
Companies to reflect the difference between guaranteed minimum net
worth of each of the Founding Companies and pro forma net worth.

(g) Records the cash proceeds of $26.3 million from the issuance of shares
of Common Stock, net of the estimated underwriting discount and
estimated offering costs of $2.8 million (based on an assumed initial
public offering price of $12.00 per share). Offering costs primarily
consist of accounting fees, legal fees and printing expenses.

(h) Records the cash portion of the consideration to be paid to
stockholders of the Founding Companies in connection with the
Combination, the repayment of funds advanced to Provant by two of its
executive officers and the repayment of long-term debt of the Founding
Companies.

(i) Records the payment of fees for information provided to the Company
related to the training and development industry.

The following table summarizes the adjustments to the unaudited pro forma
combined balance sheet adjustments (in thousands):

<TABLE>
<CAPTION>
Combination Adjustments Total
-------------------------------------------------------- Combination
(a) (b) (c) (d) (e) (f) Adjustments
------- -------- ------- ------- ------ ------ -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents...... $(1,442) $ -- $ -- $ -- $ 499 -- $ (943)
Due from related parties....... -- -- -- -- (344) 2,908 2,564
------ ------ ------ ------ ---- ----- ------
Total current assets......... (1,442) -- -- -- 155 2,908 1,621
Goodwill, net.................. -- -- 49,050 -- -- -- 49,050
Other assets................... -- -- -- 76 (110) -- (34)
------ ------ ------ ------ ---- ----- ------
Total assets......... $(1,442) $ -- $49,050 $ 76 $ 45 $2,908 $50,637
====== ====== ====== ====== ==== ===== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Payable to
stockholder/affiliate........ $ -- $ 22,463 $ -- $ -- $ -- $ -- $22,463
------ ------ ------ ------ ---- ----- ------
Long-term debt, net of current
portion...................... -- -- -- -- -- -- --
Deferred tax liability......... -- -- -- 1,276 -- -- 1,276
------ ------ ------ ------ ---- ----- ------
Total liabilities.... -- 22,463 -- 1,276 -- -- 23,739
Redeemable common stock........ -- -- (300) -- -- -- (300)
Stockholders' equity:..........
Common stock................. -- -- -- -- -- -- --
Additional paid-in capital... (1,442) (22,463) 49,350 (1,200) -- 2,908 27,153
Retained earnings............ -- -- -- -- -- -- --
Treasury stock............... -- -- -- -- -- -- --
Note receivable from stock
sales..................... -- -- -- -- 45 -- 45
------ ------ ------ ------ ---- ----- ------
Total stockholders'
equity............. (1,442) (22,463) 49,050 (1,200) 45 2,908 27,198
------ ------ ------ ------ ---- ----- ------
Total liabilities and
stockholders'
equity............. $(1,442) $ -- $49,050 $ 76 $ 45 $2,908 $50,637
====== ====== ====== ====== ==== ===== ======
</TABLE>

F-8
<PAGE> 73

PROVANT, INC. AND FOUNDING COMPANIES

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

<TABLE>
<CAPTION>
Offering
Adjustments Total
------------------------------- Offering
(g) (h) (i) Adjustments
-------- -------- ----- -----------
<S> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents........................ $ 26,316 $(25,923) $(750) $ (357)
Other.......................................... -- -- -- --
-------- -------- ----- --------
Total current assets........................... 26,316 (25,923) (750) (357)
-------- -------- ----- --------
Total assets........................... $ 26,316 $(25,923) $(750) $ (357)
======== ======== ===== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of long-term debt................ $ -- $ (2,900) $ -- $ (2,900)
Payable to stockholders/affiliate................ (23,023) -- (23,023)
-------- -------- ----- --------
Total current liabilities.............. -- (25,923) -- (25,923)
-------- -------- ----- --------
Total liabilities...................... -- (25,923) -- (25,923)
-------- -------- ----- --------
Stockholders' equity:
Common stock................................... 26 -- -- 26
Additional paid-in capital..................... 26,290 -- -- 26,290
Retained earnings.............................. -- -- (750) (750)
Treasury stock................................. -- -- -- --
-------- -------- ----- --------
Total stockholders' equity............. 26,316 -- (750) 25,566
-------- -------- ----- --------
Total liabilities and stockholders'
equity............................... $ 26,316 $(25,923) $(750) $ (357)
======== ======== ===== ========
</TABLE>

(4) UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS ADJUSTMENTS

YEAR ENDED JUNE 30, 1997

(a) Reflects the reduction in salaries, bonuses and benefits of $4.8 million to
certain of the owners of the Founding Companies to which they have agreed
prospectively. These reductions in salaries, bonuses and benefits are in
accordance with the terms of the owners' employment agreements with the
Company entered into in connection with the Combination. Such employment
agreements are primarily for three years, contain restrictions related to
competition and provide severance under certain circumstances.

(b) Reflects the amortization of goodwill to be recorded as a result of the
Combination over a 40-year estimated life.

(c) Reflects a pro forma provision for income taxes adjusted to reflect the
Company's estimated consolidated effective tax rate subsequent to the
Combination, after considering nondeductible goodwill amortization.

(d) Reflects the historical results of operations of companies acquired by Star
in February 1997 and October 1997.

(e) Reflects the reduction in interest expense net of income tax benefit,
related to the current portion of bank debt and notes payable to
stockholders that will be repaid with the proceeds of the Offering.

F-9
<PAGE> 74

PROVANT, INC. AND FOUNDING COMPANIES

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

The following table summarizes the adjustments to the unaudited pro forma
combined statements of operations (in thousands):

<TABLE>
<CAPTION>
Adjustments
--------------------------------------------------- Total
(a) (b) (c) (d) (e) Adjustments
------- ------- ------- ------ ---- -----------
<S> <C> <C> <C> <C> <C> <C>
Total revenue................... $ -- $ -- $ -- $7,601 -- $ 7,601
Cost of revenue................. -- -- -- 4,850 -- 4,850
Selling, general and
administrative expenses....... (4,782) -- -- 2,827 -- (1,955)
Goodwill amortization........... -- 1,226 -- -- -- 1,226
------- ------- ------- ------ ---- -----------
Income from
operations.......... 4,782 (1,226) -- (76) -- 3,480
Interest expense................ -- -- -- (250) 258 8
------- ------- ------- ------ ---- -----------
Income before income
taxes............... 4,782 (1,226) -- (326) 258 3,488
Provision (benefit) for income
taxes......................... -- -- 3,284 (130) 103 3,257
------- ------- ------- ------ ---- -----------
Net income............ $ 4,782 $(1,226) $(3,284) $ (196) $155 $ 231
======= ======= ======= ====== ==== =========
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 1997

(a) Reflects the reduction in salaries, bonuses and benefits of $1.3 million to
certain of the owners of the Founding Companies to which they have agreed
prospectively. These reductions in salaries, bonuses and benefits are in
accordance with the terms of the owners' employment agreements with the
Company entered into in connection with the Combination. Such employment
agreements are primarily for three years, contain restrictions related to
competition and provide severance under certain circumstances.

(b) Reflects the amortization of goodwill to be recorded as a result of the
Combination over a 40-year estimated life.

(c) Reflects a pro forma provision for income taxes adjusted to reflect the
Company's estimated effective tax rate subsequent to the combination after
considering nondeductible goodwill amortization.

(d) Reflects the historical results of operations of a company acquired by Star
in October 1997.

(e) Reflects the reduction in interest expense, net of income tax benefit,
related to the current portion of bank debt and notes payable to
stockholders that will be repaid with the proceeds of the Offering.

(f) Reflects the payment of fees for information provided to the Company related
to the training and development industry, net of tax.

F-10
<PAGE> 75

PROVANT, INC. AND FOUNDING COMPANIES

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS -- (CONTINUED)

The following table summarizes the adjustments to the unaudited pro forma
combined statements of operations (in thousands):

<TABLE>
<CAPTION>
Adjustments
---------------------------------------------------- Total
(a) (b) (c) (d) (e) (f) Adjustments
------- ----- ----- ------ ---- ----- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Total revenue................... $ -- $ -- $ -- $1,419 $ -- $ -- $ 1,419
Cost of revenue................. -- -- -- 1,056 -- -- 1,056
Selling, general and
administrative expenses....... (1,280) -- -- 352 -- 750 (178)
Goodwill amortization........... -- 307 -- -- -- -- 307
----- ---- ---- ----- --- ----- -------
Income from
operations.......... 1,280 (307) -- 11 -- (750) 234
Other income (expense):
Interest expense.............. -- -- -- (29) 73 -- 44
----- ---- ---- ----- --- ----- -------
Income before income
taxes............... 1,280 (307) -- (18) 73 (750) 278
Provision (benefit) for income
taxes......................... -- -- 696 (7) 29 (300) 418
----- ---- ---- ----- --- ----- -------
Net income............ $ 1,280 $(307) $(696) $ (11) $ 44 $(450) $ (140)
===== ==== ==== ===== === ===== =======
</TABLE>

(5) NET INCOME PER SHARE

The shares used in computing pro forma net income per share consist of (i)
2,978,790 shares held by the stockholders of Provant prior to the Offering (ii)
3,826,815 shares issued to owners of the Founding Companies (excluding shares
issuable as Additional Consideration and pursuant to the Star Contingent
Consideration) and (iii) 2,600,000 shares of Common Stock sold in the Offering.

F-11
<PAGE> 76

INDEPENDENT AUDITORS' REPORT

The Board of Directors,
Provant, Inc.:

We have audited the accompanying balance sheet of Provant, Inc., as of June
30, 1997 and the related statements of operations, stockholders' equity and cash
flows for the period from November 16, 1996 (date of inception) to June 30,
1997. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining on a test basis evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Provant, Inc. as of June 30,
1997 and the results of its operations and its cash flows for the period from
November 16, 1996 (date of inception) to June 30, 1997, in conformity with
generally accepted accounting principles.

KPMG PEAT MARWICK LLP

Boston, Massachusetts
January 9, 1998

F-12
<PAGE> 77

PROVANT, INC.

BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
JUNE 30, SEPTEMBER 30,
1997 1997
-------- -------------
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash and cash equivalents............................................. $ 1 $ 3
Deferred income taxes................................................. 60 143
---- ----
Total current assets........................................ 61 146
Property and equipment................................................ 150 153
Deferred offering costs............................................... -- 50
---- ----
Total assets................................................ $ 211 $ 349
==== ====
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Notes payable to stockholders......................................... $ 298 $ 560
---- ----
Total current liabilities................................... 298 560
Stockholders' equity (deficit):
Common stock, $.01 per value; 10,000 shares authorized; 1,992.3 and
3,389.6 shares issued and outstanding at June 30, 1997 and
September 30, 1997, respectively................................. -- --
Paid-in capital..................................................... 2 3
Accumulated deficit................................................. (89) (214)
---- ----
Total stockholders' equity (deficit)........................ (87) (211)
---- ----
Total liabilities and stockholders' equity (deficit)........ $ 211 $ 349
==== ====
</TABLE>

See accompanying notes to financial statements.

F-13
<PAGE> 78

PROVANT, INC.

STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
PERIOD FROM
NOVEMBER 16, 1996
(DATE OF THREE MONTHS
INCEPTION) TO ENDED
JUNE 30, 1997 SEPTEMBER 30, 1997
----------------- ------------------
(UNAUDITED)
<S> <C> <C>
Revenue.................................................... $ -- $ --
-------- --------
General and administrative expenses........................ 149 200
-------- --------
Interest expense........................................... -- 8
Loss before income taxes................................... (149) (208)
-------- --------
Income tax benefit......................................... 60 83
-------- --------
Net loss................................................... $ (89) $ (125)
======== ========
</TABLE>

See accompanying notes to financial statements

F-14
<PAGE> 79

PROVANT, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON STOCK
------------------ ACCUMULATED
SHARES AMOUNT DEFICIT TOTAL
------- ------ -------- -----
<S> <C> <C> <C> <C>
Initial capitalization............................... 1,992.3 $2 $ -- $ 2
Net (loss)................................. -- (89) (89)
------- --- -------- -----
Balance at June 30, 1997............................. 1,992.3 2 (89) (87)
Issuance of management shares........................ 1,397.3 1 -- 1
Net (loss)................................. -- -- (125) (125)
------- --- -------- -----
Balance, September 30, 1997 (Unaudited).............. 3,389.6 $3 $ (214) (211)
======= === ======== =====
</TABLE>

See accompanying notes to financial statements.

F-15
<PAGE> 80

PROVANT, INC.

STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

<TABLE>
<CAPTION>
PERIOD FROM
NOVEMBER 16, 1996
(DATE OF THREE MONTHS
INCEPTION) TO ENDED
JUNE 30, 1997 SEPTEMBER 30, 1997
---------------------- ------------------
(UNAUDITED)
<S> <C> <C>
Cash flows from operating activities:
Net (loss)........................................... $ (89) $ (125)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Changes in assets and liabilities:
Deferred offering costs......................... -- (50)
Accrued expenses................................ -- 8
Increase in deferred taxes...................... (60) (83)
---- ----
Net cash used in operating activities........ (149) (250)
---- ----
Cash flows from investing activities:
Acquisition of property and equipment................ (150) (3)
---- ----
Net cash used in investing activities........ (150) (3)
---- ----
Cash flows from financing activities...................
Issuance of stock.................................... 2 1
Increase in notes payable to stockholders............ 298 254
---- ----
Net cash provided by financing activities.... 300 255
---- ----
Net increase in cash and cash equivalents.............. 1 2
Cash and cash equivalents, beginning of period......... -- 1
---- ----
Cash and cash equivalents, end of period............... $ 1 $ 3
==== ====
</TABLE>

See accompanying notes to financial statements

F-16
<PAGE> 81

PROVANT, INC.

NOTES TO FINANCIAL STATEMENTS

(IN THOUSANDS)

(1) BUSINESS AND ORGANIZATION

Provant, Inc. (the "Company"), a Delaware corporation, was incorporated on
November 16, 1996. Provant intends to acquire seven providers of training and
development services and products in separate merger transactions (the
"Combination") simultaneously with its initial public offering (the "Offering")
of its Common Stock. The consummation of the Combination is conditioned upon the
closing of the Offering.

The Company has not conducted any operations, and all activities to date
have related to the Offering and the Combination. The Company's cash balances
were generated from the initial capitalization of the Company (see Note 3). All
other expenditures to date have been funded by loans from two of the Company's
principal stockholders.

The stockholders have committed to loan the Company the expenses and costs
of the Offering and the Combination. As of June 30, 1997 and September 30, 1997,
approximately $298 and $560 (unaudited), respectively, have been loaned by the
stockholders in connection with the Offering and the Combination. Certain costs
have been accounted for as deferred offering costs. There is no assurance that
the pending Combination discussed below will be completed or that the Company
will be able to generate future operating revenues.

(2) INTERIM FINANCIAL INFORMATION

The interim financial statements as of September 30, 1997 and for the three
months then ended are unaudited, and certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been omitted. In the opinion
of management, all adjustments, consisting only of normal recurring adjustments
necessary to present fairly the financial position, results of operations and
cash flows with respect to the interim financial statements, have been included.
The results of operations for the interim periods are not necessarily indicative
of the results for the entire fiscal year.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

(3) STOCKHOLDERS' EQUITY

In connection with its organization and initial capitalization, the Company
sold 1,992.3 shares of its common stock, $.01 par value per share (the "Common
Stock"), at $1.00 per share. During the three months ended September 30, 1997,
the Company sold 1,397.3 additional shares for $1.00 per share. Holders of
Common Stock are entitled to one vote for each share held of record on all
matters submitted to a vote of the stockholders, and do not have cumulative
voting rights.

Statement of Financial Accounting Standards (SFAS) No. 123, "Accounting for
Stock-Based Compensation," allows entities to choose between a fair value based
method of accounting for employee stock options or similar equity instruments
and the current intrinsic, value-based method of accounting prescribed by
Accounting Principles Board Opinion No. 25 (APB No. 25). Entities electing to
remain with the accounting in APB Opinion No. 25 must make pro forma disclosures
of net income and earnings per share as if the fair

F-17
<PAGE> 82

PROVANT, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

value method of accounting had been applied. The Company will provide pro forma
disclosure of net income and earnings per share, as applicable, in the notes to
future consolidated financial statements.

(4) PRO FORMA STOCKHOLDERS' EQUITY (UNAUDITED)

The following unaudited, pro forma share and per share data is based on the
Company's intentions with respect to the Offering.

In connection with the Offering, the Company will increase the authorized
shares of stock to 45 million, consisting of 40 million shares of Common Stock
and 5 million shares of Preferred Stock, and will declare a stock split of
871.52633-for-1 in the form of a stock dividend that will result in a total
amount of outstanding shares of Common Stock prior to the offering (but giving
effect to the Combination) of 6,805,605.

Preferred Stock

The following presents stockholders' equity on an actual and pro forma
basis (to give effect to the recapitalization and stock split) as of September
30, 1997 (in thousands).

<TABLE>
<CAPTION>
ACTUAL PRO FORMA
----- ---------
<S> <C> <C>
Preferred Stock
None authorized (5 million shares authorized, none
issued and outstanding pro forma).................. $ -- $ --
Common Stock
10,000 shares authorized (40 million shares authorized
pro forma); 3,389.6 shares issued and outstanding,
(2,954,125 shares issued and outstanding, pro
forma)............................................. -- 3
Paid-in capital......................................... 3 --
Accumulated deficit..................................... (214) (214)
----- ---------
Total......................................... $(211) $(211)
===== =======
</TABLE>

Equity Incentive Plan

The Company will adopt the 1998 Equity Incentive Plan (the "Equity
Incentive Plan"), which provides for the award of up to 1.1 million shares of
Common Stock in the form of incentive stock options ("ISOs"), non-qualified
stock options, stock appreciation rights, performance shares, restricted stock,
or stock units (each, an "Award"). All directors and employees of, and all
consultants and advisors to, the Company (including its subsidiaries) are
eligible to participate in the Equity Incentive Plan.

F-18
<PAGE> 83

PROVANT, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Stock Options

On or prior to the date of the final Prospectus used in connection with the
Offering, the Company has agreed to grant options to purchase an aggregate of
833,464 shares of Common Stock having a per-share exercise price equal to the
initial offering price. Of this amount, options to purchase 665,280 shares will
become exercisable with respect to one-third of the underlying shares of Common
Stock on each of the first three anniversaries of the date of grant. The
remaining options to purchase 168,184 shares will become exercisable with
respect to all of the underlying shares of Common Stock upon the closing of the
Offering.

Stock Warrants

As partial consideration for the extension to the Company of the financing
described in Note 5 below, two of the Company's executive officers each received
two warrants. The first warrant is exercisable for 176,368 shares of common
stock at a per share exercise price equal to the initial public offering price.
The second warrant is a warrant to purchase 220,460 shares of common stock which
will become exercisable only if the market price of the Common Stock increases
to certain threshold levels except as described below (the "Contingent
Warrant"). Specifically, 20% of the total number of shares issuable under the
Contingent Warrants will become exercisable on each of the three occasions that
the market price of the Common Stock increases by 100%, 200%, 300%,
respectively, from the initial public offering price, and the remaining 40% of
the total number of shares issuable under the Contingent Warrant will become
exercisable if the market price of the Common Stock increases by 400%. However,
under certain circumstances involving the merger or sale of the Company, the
Contingent Warrant will become exercisable to purchase all of the warrant
shares. The exercise price of the Contingent Warrant increases on each
anniversary of the closing of the Offering. Specifically, the exercise price is
equal to the initial public offering price for the first 12 months following the
closing of the Offering and, for each 12-month period thereafter, is equal to
the initial public offering price plus 10% of the initial public offering price
multiplied by the number of full 12 month periods elapsed since the closing of
the Offering. However, once a portion of the Contingent Warrant becomes
exercisable, that portion's exercise price is fixed as of that date. All four
warrants expire on the seventh anniversary of the closing of the Offering.

The holders of the warrants have the right to require the Company to
register the resale of the shares that may be acquired upon exercise of the
warrants under the Securities Act of 1933, as amended.

Stock Purchase Plan

The Company will adopt the 1998 Employee Stock Purchase Plan (the "Plan").
The Plan provides for the sale of shares of Common Stock to employees at a
purchase price that is 85% of the lesser of the value of the Common Stock at the
beginning of a purchase period or at the end of a purchase period. The Company
has reserved 500,000 shares of Common Stock for issuance under the Plan.

Non-Employee Directors' Stock Plan

The Company's Board of Directors has adopted the Stock Plan for
Non-Employee Directors (the "Directors' Plan"). A total of 100,000 shares of
Common Stock are reserved for issuance under the Directors' Plan. Pursuant to
the Directors' Plan, on the date of the final Prospectus used in connection with
the Offering, each director and director nominee who is neither an employee of
the Company or one of its subsidiaries (a "non-employee director") will receive
an option to purchase 7,500 shares of Common Stock with a per-share exercise
price equal to the initial public offering price. Each non-employee director
initially elected following the Offering will be granted upon such election an
option to purchase 7,500 shares of Common Stock. Following his or her initial
election, each non-employee director will be granted, immediately following each
annual meeting of stockholders at which he or she is re-elected (and provided he
or she is still is a non-employee director at such time), an option to acquire
an additional 2,500 shares of Common Stock. The per

F-19
<PAGE> 84

PROVANT, INC.

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

share exercise price of options granted following the Offering will be the fair
market value of the Common Stock on the date of grant. Each option will be
non-transferable except upon death (unless otherwise approved by the Board),
will expire 10 years after the date of grant will become exercisable with
respect to all of the shares of Common Stock issuable thereunder on the date
that is six months following the date of grant if the individual is a director
at such time. If the director dies or otherwise ceases to be a director prior to
the expiration of an option, the option (if exercisable) will remain exercisable
for a period of one year following death or three months following other
termination of the individual's status as a director, but in no event beyond the
tenth anniversary of the date of grant. The Board of Directors may at any time
or times amend the Directors' Plan for any purpose that at the time may be
permitted by law.

(5) RELATED PARTY TRANSACTION

Expenses paid by the Company prior to the closing of the Offering have been
advanced under a $3 million line of credit issued on October 6, 1997 by two of
the Company's stockholders.

Amounts payable to stockholders under the line of credit are due on the
earlier of October 6, 2000 or the successful completion of the Offering and bear
interest at the prime rate as from time to time published in the Wall Street
Journal (8.5% at June 30, 1997).

The acquisition Company's property and equipment at June 30, 1997, obtained
from stockholders of the Company, was financed under the line of credit.

(6) SUBSEQUENT EVENT (UNAUDITED)

The Company and wholly-owned subsidiaries of the Company have signed
definitive agreements to acquire by merger seven companies ("the Founding
Companies") to be effective contemporaneously with the Offering. The companies
to be acquired are Behavioral Technology, Inc., Decker Communications, Inc., J.
Howard and Associates, Inc., Robert Steinmetz, Ph.D., and Associates, Inc.,
d/b/a, Learning Systems Sciences, MOHR Retail Learning Systems, Inc., Novations
Group, Inc. and Star Mountain, Inc. The aggregate consideration that will be
paid by Provant, Inc. to acquire the Founding Companies is approximately $59.2
million, consisting of $22.5 million in cash and 3,826,815 shares of Common
Stock (assuming an initial public offering price of $12.00 per share).

F-20
<PAGE> 85

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Behavioral Technology, Inc.:

We have audited the accompanying balance sheets of Behavioral Technology,
Inc., as of June 30, 1997 and 1996, and the related statements of operations,
stockholders' equity and cash flows for each of the years in the three-year
period ended June 30, 1997. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining on a test basis evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Behavioral Technology, Inc.
as of June 30, 1997 and 1996, and the results of its operations and its cash
flows for each of the years in the three-year period ended June 30, 1997, in
conformity with generally accepted accounting principles.

KPMG PEAT MARWICK LLP

Boston, Massachusetts
January 9, 1998

F-21
<PAGE> 86

BEHAVIORAL TECHNOLOGY, INC.

BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable........................................... $ 270 $ 268 $ 267
Accrued expenses........................................... 123 148 186
Accrued compensation....................................... 316 433 484
Deferred revenue........................................... 12 43 15
------ ------ ------
Total current liabilities.......................... 721 892 952
------ ------ ------
Commitments and contingencies
Stockholders' equity:
Common stock, $10 par value; 1,000 shares authorized; 100,
99 and 104 shares issued and outstanding at June 30,
1996, June 30, 1997 and September 30, 1997,
respectively............................................ 1 1 1
Additional paid-in capital................................. -- -- 182
Translation adjustment..................................... -- (6) (6)
Retained earnings.......................................... 1,139 1,707 2,000
------ ------ ------
Total stockholders' equity......................... 1,140 1,702 2,177
------ ------ ------
Total liabilities and stockholders' equity......... $1,861 $2,594 $ 3,129
====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-22
<PAGE> 87

BEHAVIORAL TECHNOLOGY, INC.

STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED JUNE 30, SEPTEMBER 30,
---------------------------- -----------------
1995 1996 1997 1996 1997
------ ------ ------ ------ ------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenue....................................... $3,803 $5,685 $7,096 $1,712 $1,977
Cost of revenue............................... 1,049 1,495 1,488 387 385
------ ------ ------ ------ ------
Gross profit........................ 2,754 4,190 5,608 1,325 1,592
Selling, general and administrative
expenses.................................... 2,315 4,048 5,111 969 1,306
------ ------ ------ ------ ------
Income from operations.............. 439 142 497 356 286
------ ------ ------ ------ ------
Other income:
Royalties................................... 83 82 30 -- --
Interest.................................... 13 27 31 6 7
Other income, net........................... 43 -- 10 -- --
------ ------ ------ ------ ------
Total other income.................. 139 109 71 6 7
------ ------ ------ ------ ------
Net income.......................... $ 578 $ 251 $ 568 $ 362 $ 293
====== ====== ====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-23
<PAGE> 88

BEHAVIORAL TECHNOLOGY, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL
----------------- PAID-IN TRANSLATION RETAINED
SHARES AMOUNT CAPITAL ADJUSTMENT EARNINGS TOTAL
------ ------ ---------- ----------- -------- ------
<S> <C> <C> <C> <C> <C> <C>
Balance, June 30, 1994........... 100 $1 $ -- $-- $ 310 $ 311
Net income..................... -- -- -- -- 578 578
--
--- ---- ---- ------ ------
Balance, June 30, 1995........... 100 1 -- -- 888 889
Net income..................... -- -- -- -- 251 251
--
--- ---- ---- ------ ------
Balance, June 30, 1996........... 100 1 -- -- 1,139 1,140
Net income..................... -- -- -- -- 568 568
Translation adjustment......... -- -- -- (6) -- (6)
Stock surrender................ (1) -- -- -- -- --
--
--- ---- ---- ------ ------
Balance, June 30, 1997........... 99 1 -- (6) 1,707 1,702
Net income..................... -- -- -- -- 293 293
Stock grant.................... 5 -- 182 -- -- 182
--
--- ---- ---- ------ ------
Balance, September 30, 1997
(Unaudited).................... 104 $1 $182 $(6) $2,000 $2,177
=== == ==== ==== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-24
<PAGE> 89

BEHAVIORAL TECHNOLOGY, INC.

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED JUNE 30, SEPTEMBER 30,
------------------------ ---------------
1995 1996 1997 1996 1997
----- ----- ------ ----- ------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income........................................ $ 578 $ 251 $ 568 $ 362 $ 293
----- ----- ------ ----- ------
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization................ 57 46 92 65 21
Non-cash compensation........................ -- -- -- -- 182
Changes in operating assets and liabilities:
Increase in accounts receivable........... (176) (195) (115) (205) (600)
Increase in prepaid expenses.............. -- (67) (76) (1) (17)
Decrease in other assets.................. -- -- 1 1 (2)
Increase (decrease) in accounts payable... 90 47 (2) (66) (1)
Increase in accrued expenses.............. 19 172 142 4 89
Increase (decrease) in deferred revenue... 22 (48) 31 -- (28)
----- ----- ------ ----- ------
Total adjustments....................... 12 (45) 73 (202) (356)
----- ----- ------ ----- ------
Net cash provided by (used in) operating
activities........................... 590 206 641 160 (63)
----- ----- ------ ----- ------
Cash flows from investing activities:
Purchases of property and equipment............... (157) (122) (42) (20) (3)
Proceeds from sale of property and equipment...... -- 5 9 -- --
Purchase of trademark............................. -- (7) -- -- --
----- ----- ------ ----- ------
Net cash used in investing activities... (157) (124) (33) (20) (3)
----- ----- ------ ----- ------
Cash flows from financing activities:
Proceeds received on line of credit............... -- -- 200 -- --
Principal payments on line of credit.............. -- -- (200) -- --
----- ----- ------ ----- ------
Net cash used in financing activities... -- -- -- -- --
----- ----- ------ ----- ------
Net increase (decrease) in cash and cash
equivalents....................................... 433 82 608 140 (66)
Effect of exchange rate changes on cash............. -- -- (6) (1) --
Cash and cash equivalents, beginning of period...... 137 570 652 652 1,254
----- ----- ------ ----- ------
Cash and cash equivalents, end of period............ $ 570 $ 652 1,254 $ 791 $1,188
===== ===== ====== ===== ======
Supplemental disclosure:
Cash paid for interest............................ $ -- $ -- $ 2 $ -- $ --
===== ===== ====== ===== ======
</TABLE>

See accompanying notes to financial statements.

F-25
<PAGE> 90

BEHAVIORAL TECHNOLOGY, INC.

NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)

(1) NATURE OF OPERATIONS

Behavioral Technology, Inc. (the "Company") was founded in 1978. The
Company primarily provides train-the-trainer programs designed to help its
clients improve employee selection and to provide managers with a methodology
for assessing strengths and weaknesses of current employees. BTI's revenue is
derived primarily from the licensing to clients of the right to use its training
materials.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

Revenue is recognized as services are performed. The Company also licenses
to its clients the use of the Company's behavioral interviewing techniques. The
entire sale price is recognized when the noncancellable contract is signed and
the right to use the intellectual property is transferred. Deferred revenue is
recognized for payments received prior to services being performed.

Use of Estimates

Interim Financial Information

The interim financial statements as of September 30, 1997 and for the three
months ended September 30, 1996 and 1997, are unaudited, and certain information
and footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles, have been omitted. In
the opinion of management, all adjustments, consisting only of normal recurring
adjustments necessary to present fairly the financial position, results of
operations and cash flows with respect to the interim financial statements have
been included. The results of operations for the interim periods are not
necessarily indicative of the results for the entire fiscal year.

Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.

Prepaid Expenses

Prepaid expenses consist of costs incurred in developing videos and
publishing books. The costs of the videos are being amortized over five years
and the costs of the books are expensed as books are sold.

Property and Equipment

Property and equipment are stated at cost and depreciated using an
accelerated method over periods ranging from five to seven years. Leasehold
improvements are amortized over the term of the lease.

F-26
<PAGE> 91

BEHAVIORAL TECHNOLOGY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Fair Value of Financial Instruments

Financial instruments of the Company consist primarily of cash and cash
equivalents, short-term certificates of deposit, accounts receivable, accounts
payable and accrued expenses. The carrying value of these financial instruments
approximates their fair value due to the short maturity of these instruments.

Foreign Currency Translation

The Company operates a branch in Canada. Assets and liabilities for the
branch are translated into U.S. Dollars at the end of the year using year-end
exchange rates. Income and expenses are translated using the average exchange
rates for the year. Translation gains and losses are reported as a separate
component of stockholders' equity.

Income Taxes

The Company has elected to be treated as an S corporation. Therefore, the
net income of the Company is reported by the stockholders. Accordingly, no
provision for federal income taxes has been included in the financial
statements. Only certain state taxes are paid by the Company. The Company will
terminate its S corporation status concurrently with the combination described
in note 8.

(3) RELATED PARTY TRANSACTIONS

The Company conducts its administrative operations in a facility leased
from the principal stockholder of the Company. Lease expense for the years ended
June 30, 1995, 1996 and 1997 was $90, $76 and $85, respectively.

Future minimum lease payments under all noncancelable operating leases are
as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30,
----------------------------------------------------------------------
<S> <C>
1998............................................................ $ 83
1999............................................................ 86
2000............................................................ 89
2001............................................................ 89
2002............................................................ 45
----
$392
====
</TABLE>

(4) PROPERTY AND EQUIPMENT

Property and equipment consist of the following at:

<TABLE>
<CAPTION>
JUNE 30,
-------------
1996 1997
---- ----
<S> <C> <C>
Machinery and equipment....................................... $272 $307
Furniture and fixtures........................................ 97 95
Leasehold improvements........................................ 18 18
---- ----
387 420
Accumulated depreciation and amortization..................... 193 285
---- ----
Property and equipment, net......................... $194 $135
==== ====
</TABLE>

Depreciation and amortization expense related to property and equipment for
the years ended June 30, 1995, 1996 and 1997 was $57, $46 and $92, respectively.

F-27
<PAGE> 92

BEHAVIORAL TECHNOLOGY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(5) LINE OF CREDIT

The Company entered into a line of credit agreement on October 15, 1996 for
borrowings up to $500. The line bears interest at prime plus 1%, is secured by
the accounts receivable of the Company, and is personally guaranteed by the
principal stockholder. The line of credit had a maturity date of October 15,
1997 and was renewed until October 15, 1998. There were no amounts outstanding
under this agreement at June 30, 1997.

(6) EMPLOYEE BENEFITS

The Company adopted a 401(k) profit sharing plan on January 1, 1996 that
covers all employees above the age of twenty-one who have completed one year of
service. Company contributions are made each year at the discretion of the Board
of Directors. The Company contributed $66 to the plan for the year ended June
30, 1996. No contribution was made for the year ended June 30, 1997.

(7) CONCENTRATION OF CREDIT RISK

The Company's credit risks primarily relate to cash and cash equivalents
and accounts receivable. Cash and cash equivalents are primarily held in bank
accounts. Cash deposits in excess of FDIC insurance limits approximated $1,040
at June 30, 1997. The Company has not incurred losses related to these balances
to date.

(8) SUBSEQUENT EVENT (UNAUDITED)

In February 1998, the Company entered into a definitive merger agreement
with Provant, Inc. ("Provant") and one of its subsidiaries, whereby Provant will
acquire the Company upon completion of the proposed initial public offering.

F-28
<PAGE> 93

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Decker Communications, Inc.:

We have audited the accompanying balance sheets of Decker Communications,
Inc., as of June 30, 1997 and 1996, and the related statements of operations,
stockholders' equity, and cash flows for each of the years in the three-year
period ended June 30, 1997. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Decker Communications, Inc.,
as of June 30, 1997 and 1996, and the results of its operations and its cash
flows for each of the years in the three-year period ended June 30, 1997 in
conformity with generally accepted accounting principles.

KPMG PEAT MARWICK LLP

Boston, Massachusetts
January 9, 1998

F-29
<PAGE> 94

DECKER COMMUNICATIONS, INC.

BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
JUNE 30,
----------------- SEPTEMBER 30,
1996 1997 1997
------ ------ -------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.................................. $ 314 $ 508 $ 526
Investments................................................ 565 533 932
Accounts receivable, net of allowance for doubtful accounts
of $142 at June 30, 1996 and $150 at June 30, 1997 and
September 30, 1997...................................... 1,123 1,489 1,441
Receivables from related parties........................... -- -- 290
Prepaid expenses and other current assets.................. 170 140 102
------ ------ ------
Total current assets............................... 2,172 2,670 3,291
------ ------ ------
Property and equipment, net.................................. 497 338 359
Other assets................................................. 47 59 59
------ ------ ------
Total assets....................................... $2,716 $3,067 $ 3,709
====== ====== ======

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable........................................... $ 251 $ 111 $ 284
Accrued expenses........................................... 368 466 459
Accrued compensation....................................... 498 668 849
Taxes payable.............................................. 44 35 62
Current portion of note payable............................ -- 416 410
Deferred revenue........................................... 92 89 114
------ ------ ------
Total current liabilities.......................... 1,253 1,785 2,178
------ ------ ------
Note payable, net of current portion......................... -- 623 615
Redeemable common stock...................................... -- 300 300
Commitments and contingencies
Stockholders' equity:
Common stock, no par value; 750,000 shares authorized;
176,972, 138,027 and 143,417 shares issued and
outstanding at June 30, 1996, June 30, 1997 and
September 30, 1997, respectively........................ 397 269 313
Unrealized gain on investments............................. 5 9 9
Note receivable from stock sales........................... (92) (127) (171)
Retained earnings.......................................... 1,153 208 465
------ ------ ------
Total stockholders' equity......................... 1,463 359 616
------ ------ ------
Total liabilities and stockholders' equity......... $2,716 $3,067 $ 3,709
====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-30
<PAGE> 95

DECKER COMMUNICATIONS, INC.

STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED JUNE 30, SEPTEMBER 30,
---------------------------- -----------------
1995 1996 1997 1996 1997
------ ------ ------ ------ ------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenue....................................... $8,550 $8,620 $8,410 $1,930 $2,585
Cost of revenue............................... 2,419 2,655 2,275 549 660
------ ------ ------ ------ ------
Gross profit................................ 6,131 5,965 6,135 1,381 1,925
Selling, general and administrative
expenses.................................... 5,670 5,716 5,621 1,261 1,663
------ ------ ------ ------ ------
Income from operations...................... 461 249 514 120 262
Other (income) expense........................ (54) (74) 9 (15) 3
------ ------ ------ ------ ------
Income before income taxes.................. 515 323 505 135 259
State income taxes............................ 67 30 33 2 2
------ ------ ------ ------ ------
Net income.................................. $ 448 $ 293 $ 472 $ 133 $ 257
====== ====== ====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-31
<PAGE> 96

DECKER COMMUNICATIONS, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
NOTE
COMMON STOCK UNREALIZED RECEIVABLE
---------------- GAIN ON FROM STOCK RETAINED
SHARES AMOUNT INVESTMENTS SALES EARNINGS TOTAL
------- ------ ----------- ---------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
Balance, June 30, 1994................. 174,000 $ 314 $-- $ -- $ 986 $ 1,300
Sale of stock........................ 5,500 49 -- (50) -- (1)
Net income........................... -- -- -- -- 448 448
Dividends............................ -- -- -- -- (300) (300)
------- ----- --- ----- ------ -------
Balance, June 30, 1995................. 179,500 363 -- (50) 1,134 1,447
Sale of stock........................ 4,000 42 -- (42) -- --
Repurchase of stock.................. (6,528) (8) -- -- (59) (67)
Unrealized gain on investments....... -- -- 5 -- -- 5
Net income........................... -- -- -- -- 293 293
Dividends............................ -- -- -- -- (215) (215)
------- ----- --- ----- ------ -------
Balance, June 30, 1996................. 176,972 397 5 (92) 1,153 1,463
Sale of stock........................ 8,080 35 -- (35) -- --
Repurchase of stock.................. (37,850) (163) -- -- (963) (1,126)
Unrealized gain on investments....... -- -- 4 -- -- 4
Redeemable common stock.............. (9,175) -- -- -- (300) (300)
Net income........................... -- -- -- -- 472 472
Dividends............................ -- -- -- -- (154) (154)
------- ----- --- ----- ------ -------
Balance, June 30, 1997................. 138,027 269 9 (127) 208 359
Sale of stock........................ 5,390 44 -- (44) -- --
Net income........................... -- -- -- -- 257 257
------- ----- --- ----- ------ -------
Balance, September 30, 1997
(Unaudited).......................... 143,417 $ 313 $ 9 $ (171) $ 465 $ 616
======= ===== === ===== ====== =======
</TABLE>

See accompanying notes to financial statements.

F-32
<PAGE> 97

DECKER COMMUNICATIONS, INC.

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
ENDED SEPTEMBER
YEAR ENDED JUNE 30, 30,
------------------------- ----------------
1995 1996 1997 1996 1997
----- ----- ----- ----- -----
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income..................................... $ 448 $ 293 $ 472 $ 133 $ 257
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization............. 127 223 194 55 44
(Gain) loss on disposal of property and
equipment.............................. -- (3) 12 -- --
Changes in operating assets and
liabilities:........................... -- -- -- -- --
(Increase) decrease in accounts
receivable, trade.................... (184) 62 (366) (11) 48
(Increase) decrease in prepaid expenses
and other current assets............. (38) (22) 30 (8) (252)
(Increase) decrease in other assets.... (18) 7 (12) -- --
Increase (decrease) in accounts payable
and accrued expenses................. 221 (28) 119 (135) 374
Increase (decrease) in deferred
revenue.............................. (40) (61) (3) 17 25
----- ----- ----- ----- -----
Total adjustments.................... 68 178 (26) (82) 239
----- ----- ----- ----- -----
Net cash provided by operating
activities........................ 516 471 446 51 496
----- ----- ----- ----- -----
Cash flows from investing activities:
Net change in investments...................... (344) 131 36 -- (399)
Purchases of property and equipment............ (136) (443) (56) (6) (65)
Proceeds from sale of property and equipment... -- 6 9 -- --
----- ----- ----- ----- -----
Net cash used in investing
activities........................ (480) (306) (11) (6) (464)
----- ----- ----- ----- -----
Cash flows from financing activities:
Dividends...................................... (300) (215) (154) -- --
Sale (repurchase) of stock..................... 50 (25) (35) -- --
Payments of notes payable...................... (6) -- (52) (13) (14)
----- ----- ----- ----- -----
Net cash used in financing
activities........................ (256) (240) (241) (13) (14)
----- ----- ----- ----- -----
Net (decrease) increase in cash and cash
equivalents.................................... (220) (75) 194 32 18
Cash and cash equivalents, beginning of period... 609 389 314 314 508
----- ----- ----- ----- -----
Cash and cash equivalents, end of period......... $ 389 $ 314 $ 508 $ 346 $ 526
===== ===== ===== ===== =====
Supplemental disclosure:
Cash paid for interest......................... $ -- $ -- $ 80 $ -- $ 19
===== ===== ===== ===== =====
Supplemental disclosure of non-cash item:
Increase (decrease) in market value of
investments................................. $ 19 $ (11) $ 4 $ -- $ --
===== ===== ===== ===== =====
</TABLE>

See accompanying notes to financial statements.

F-33
<PAGE> 98

DECKER COMMUNICATIONS, INC.

NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)

(1) NATURE OF OPERATIONS

Decker Communications, Inc. (the "Company") was founded in 1979. The
Company provides instructor-led training to businesses to improve employees'
business communication skills and communication between management and
employees. Revenue is derived primarily from fees charged to participants in its
instructor-led training programs.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

Revenues are recognized as products and services are provided.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Interim Financial Information

The interim financial statements as of September 30, 1997 and for the three
months ended September 30, 1996 and 1997 are unaudited, and certain information
and footnote disclosures normally included in the financial statements prepared
in accordance with generally accepted accounting principles have been omitted.
In the opinion of management, all adjustments consisting only of normal
recurring adjustments necessary to present fairly the financial position,
results of operations and cash flows with respect to the interim financial
statements have been included. The results of operations for the interim periods
are not necessarily indicative of the results for the entire fiscal year.

Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.

Marketable Securities

Marketable investment securities consist of U.S. treasury bills and equity
securities in various mutual funds. The investments are stated at fair market
value and are accounted for as available for sale securities under the
provisions of Statement of Financial Accounting Standards No. 115, Accounting
for Certain Investments in Debt and Equity Securities. Unrealized gains are
included as a separate component of stockholders' equity.

Property and Equipment

Property and equipment are stated at cost and depreciated using an
accelerated method over periods ranging from five to seven years. Leasehold
improvements are amortized over the lease term.

Fair Value of Financial instruments

Financial instruments of the Company consist of cash and cash equivalents,
investments, accounts and notes receivable, accounts payable and accrued
liabilities. The carrying value of these financial instruments

F-34
<PAGE> 99

DECKER COMMUNICATIONS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

approximates their fair value because of the short maturity of these
instruments. Based upon borrowing rates currently available to the Company for
issuance of similar debt with similar terms and remaining maturities, the
estimated fair value of the long-term debt approximates its carrying amount.

Income Taxes

Library of Copyrighted Materials

The Company derives a substantial portion of its revenue from training
programs which are based on its library of copyrighted materials and other
materials developed within the Company. Costs associated with the development of
these materials have been expensed as incurred.

(3) RELATED PARTY TRANSACTIONS

The Company has a note receivable from a stockholder and officer of the
Company for the purchase of stock. The balance of this note was $92 and $127 at
June 30, 1996 and 1997, respectively. The note bears interest at the prevailing
rate and is secured by shares of Company stock and may be repaid by cash or
redemption of the stock to the Company. The note is reflected as a reduction of
stockholders' equity in the accompanying balance sheets.

(4) PROPERTY AND EQUIPMENT

Property and equipment consist of the following at:

<TABLE>
<CAPTION>
JUNE 30,
-----------------
1996 1997
------ ------
<S> <C> <C>
Equipment.................................................. $ 665 591
Furniture and fixtures..................................... 336 334
Software................................................... 129 143
Leasehold improvements..................................... 17 19
------ ------
1,147 1,087
Accumulated depreciation and amortization.................. 650 749
------ ------
Property and equipment, net...................... $ 497 338
====== ======
</TABLE>

Depreciation and amortization expense related to property and equipment for
the years ended June 30, 1995, 1996 and 1997 was $127, $223 and $194,
respectively.

(5) NOTE PAYABLE

The note payable consists of a secured promissory note to a stockholder in
connection with a stock repurchase agreement. The note bears interest at 7.5%,
with principal and interest due monthly through June 30, 2009. The note is
secured by all tangible and intangible assets of the Company.

In connection with the stock repurchase agreement, the stockholder has the
option to accelerate the payment of a portion of the outstanding balance upon
the occurrence of certain events. One such event has occurred, as discussed in
note 10 (unaudited), giving the stockholder the right to accelerate
approximately

F-35
<PAGE> 100

DECKER COMMUNICATIONS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

$416 of the principal balance. This amount has been classified as current in the
accompanying balance sheet at June 30, 1997. The stockholder has not yet chosen
to accelerate the note.

Also in connection with the stock repurchase agreement, the Company issued
a put option to the stockholder which gave him the right, upon occurrence of a
triggering event, to sell his remaining shares of common stock to the Company at
an arbitrated value per share. Payment pursuant to this put option would be made
by amending the principal balance of the note payable by the amount of the
purchase price, effective July 1, 1999. The stockholder has not yet chosen to
exercise the put option. Common shares held under this option have been
reflected as redeemable common stock in the June 30, 1997 balance sheet.

Principal payments on long-term debt are as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30,
----------------------------------------------------
<S> <C>
1998.......................................... $ 410
1999.......................................... 60
2000.......................................... 64
2001.......................................... 69
2002.......................................... 75
Thereafter.................................... 347
------
Total..................................... $1,025
======
</TABLE>

(6) LINE OF CREDIT

The Company has a $250 line of credit agreement with a bank, with interest
payable at prime plus 1.5%. The line of credit is secured by substantially all
of the Company's assets and is guaranteed by the principal stockholder of the
Company. At June 30, 1996 and 1997, there were no amounts outstanding under the
agreement.

(7) OPERATING LEASES

The Company leases all of its facilities under cancelable and noncancelable
operating leases that expire on various dates through fiscal 2002. Most of these
leases generally provide for rent escalation based upon changes in real estate
taxes and operating expenses.

Future minimum lease payments under all noncancelable operating leases are
as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30,
----------------------------------------------------
<S> <C>
1998.......................................... $ 494
1999.......................................... 502
2000.......................................... 382
2001.......................................... 374
2002.......................................... 108
------
Total $1,860
======
</TABLE>

Rent expense for the years ended June 30, 1995, 1996 and 1997 was $505,
$561 and $510, respectively.

(8) EMPLOYEE BENEFITS

The Company has a 401(k) plan in which it matches 50% of employee annual
contributions up to $1 per employee. The Company contributed $29, $20 and $28 to
the plan for the years ended June 30, 1995, 1996 and 1997, respectively.

F-36
<PAGE> 101

DECKER COMMUNICATIONS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(9) CONCENTRATION OF CREDIT RISK

The Company's three largest customers accounted for approximately 16%, 30%,
and 16% of total revenues for the years ended June 30, 1995, 1996 and 1997,
respectively. Accounts receivable from these customers represented approximately
13% and 16% of the total accounts receivable balance at June 30, 1996 and 1997,
respectively.

(10) SUBSEQUENT EVENT (UNAUDITED)

F-37
<PAGE> 102

INDEPENDENT AUDITORS' REPORT

The Board of Directors
J. Howard & Associates, Inc.:

We have audited the accompanying balance sheets of J. Howard & Associates,
Inc., as of June 30, 1997 and December 31, 1996 and 1995, and the related
statements of operations, stockholders' equity, and cash flows for the six
months ended June 30, 1997 and each of the years in the three-year period ended
December 31, 1996. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of J. Howard & Associates,
Inc., as of June 30, 1997 and December 31, 1996 and 1995, and the results of its
operations and its cash flows for the six months ended June 30, 1997 and each of
the years in the three-year period ended December 31, 1996 in conformity with
generally accepted accounting principles.

KPMG Peat Marwick LLP

Boston, Massachusetts
January 9, 1998

F-38
<PAGE> 103

J. HOWARD & ASSOCIATES, INC.

BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
DECEMBER 31,
----------------- JUNE 30, SEPTEMBER 30,
1995 1996 1997 1997
------ ------ -------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents........................ $ 466 $ 201 $ 280 $ 811
Accounts receivable, net of allowance for
doubtful accounts of $34 at December 31, 1995,
$84 at December 31, 1996, $108 at June 30,
1997 and $84 at September 30, 1997............ 761 724 1,688 1,350
Due from employees and related parties........... 68 17 6 52
Prepaid expenses................................. 4 14 85 50
----- ----- ----- ------
Total current assets..................... 1,299 956 2,059 2,263
----- ----- ----- ------
Property and equipment, net........................ 170 365 299 290
Other assets....................................... 53 44 44 44
----- ----- ----- ------
Total assets............................. $1,522 $1,365 $2,402 $ 2,597
===== ===== ===== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable................................. $ 23 $ 12 $ 151 $ 116
Accrued expenses................................. 37 106 87 95
Accrued compensation............................. 372 32 34 97
Deferred revenue................................. 117 135 48 24
Accrued state income taxes....................... 27 38 38 38
Distributions payable............................ 138 -- -- 125
----- ----- ----- ------
Total current liabilities................ 714 323 358 495
----- ----- ----- ------
Commitments and contingencies
Stockholders' equity:
Class A voting common stock, no par value;
authorized 100,000 shares; issued and
outstanding 66,667 shares at December 31, 1995
and 72,533 shares at December 31, 1996, June
30, 1997 and September 30, 1997............... 64 175 175 175
Class B non-voting common stock, no par value;
authorized 25,000 shares; issued and
outstanding 13,333 shares at December 31, 1995
and 16,267 shares at December 31, 1996, June
30, 1997 and September 30, 1997............... 42 97 97 97
Retained earnings................................ 702 770 1,772 1,830
----- ----- ----- ------
Total stockholders' equity............... 808 1,042 2,044 2,102
----- ----- ----- ------
Total liabilities and stockholders'
equity................................. $1,522 $1,365 $2,402 $ 2,597
===== ===== ===== ======
</TABLE>

See accompanying notes to financial statements.

F-39
<PAGE> 104

J. HOWARD & ASSOCIATES, INC.

STATEMENTS OF OPERATIONS

(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, ENDED SEPTEMBER 30,
---------------------------- JUNE 30, -----------------
1994 1995 1996 1997 1996 1997
------ ------ ------ ----------- ------ ------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Revenue........................... $5,087 $6,251 $7,110 $ 4,160 $5,814 $6,077
Cost of revenue................... 1,713 1,964 2,166 1,190 1,782 1,851
------ ------ ------ ------ ------ ------
Gross profit.................... 3,374 4,287 4,944 2,970 4,032 4,226
Selling, general, and
administrative expenses......... 3,087 4,158 4,559 1,971 2,791 3,170
------ ------ ------ ------ ------ ------
Income from operations.......... 287 129 385 999 1,241 1,056
------ ------ ------ ------ ------ ------
Other income (expense):
Interest and dividend income.... 4 6 31 4 18 9
Interest expense................ (12) (9) -- -- -- --
Other income.................... -- -- 3 3 1 --
------ ------ ------ ------ ------ ------
Total other income
(expense)............. (8) (3) 34 7 19 9
------ ------ ------ ------ ------ ------
Income before income
taxes................. 279 126 419 1,006 1,260 1,065
State income taxes................ -- 10 8 4 4 5
------ ------ ------ ------ ------ ------
Net income.............. $ 279 $ 116 $ 411 $ 1,002 $1,256 $1,060
====== ====== ====== ====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-40
<PAGE> 105

J. HOWARD & ASSOCIATES, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
CLASS B
CLASS A VOTING NON-VOTING
COMMON STOCK COMMON STOCK
----------------- ----------------- RETAINED
SHARES AMOUNT SHARES AMOUNT EARNINGS TOTAL
------ ------ ------ ------ -------- ------
<S> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1993.......... 66,667 $ 64 13,333 $ 42 $ 861 $ 967
Net income........................ -- -- -- -- 279 279
Distributions to stockholders..... -- -- -- -- (81) (81)
------ ---- ------ ---- ------ ------
Balance, December 31, 1994.......... 66,667 64 13,333 42 1,059 1,165
Net income........................ -- -- -- -- 116 116
Distributions to stockholders..... -- -- -- -- (473) (473)
------ ---- ------ ---- ------ ------
Balance, December 31, 1995.......... 66,667 64 13,333 42 702 808
Net income........................ -- -- -- -- 411 411
Distributions to stockholders..... -- -- -- -- (343) (343)
Stock grant....................... 5,866 111 2,934 55 -- 166
------ ---- ------ ---- ------ ------
Balance, December 31, 1996.......... 72,533 175 16,267 97 770 1,042
Net income........................ -- -- -- -- 1,002 1,002
------ ---- ------ ---- ------ ------
Balance, June 30, 1997.............. 72,533 175 16,267 97 1,772 2,044
Net income........................ -- -- -- -- 58 58
------ ---- ------ ---- ------ ------
Balance, September 30, 1997
(Unaudited)....................... 72,533 $175 16,267 $ 97 $1,830 $2,102
====== ==== ====== ==== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-41
<PAGE> 106

J. HOWARD & ASSOCIATES, INC.

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED NINE MONTHS ENDED
DECEMBER 31, SIX MONTHS ENDED SEPTEMBER 30,
--------------------- JUNE 30, -----------------
1994 1995 1996 1997 1996 1997
----- ----- ----- ---------------- ------ ------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income............................ $ 279 $ 116 $ 411 $1,002 $1,256 $1,060
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization.... 83 95 104 75 69 130
Non-cash compensation............ -- -- 166 -- -- --
Loss on sale of property and
equipment..................... -- -- -- 15 -- 15
Changes in operating assets and
liabilities:
(Increase) decrease in
accounts receivable......... 181 (116) 37 (964) (344) (626)
(Increase) decrease in prepaid
expenses.................... 7 10 (10) (71) -- (36)
(Increase) decrease in other
assets...................... (12) 12 9 -- 11 --
Increase (decrease) in
accounts payable and accrued
expenses.................... 21 153 (282) 122 (199) 158
Increase (decrease) in state
income taxes................ -- 8 11 -- -- --
Increase (decrease) in
deferred revenue............ (17) 91 18 (87) 28 14
----- ----- ----- ------ ------ ------
Total adjustments........... 263 253 53 (910) (435) (345)
----- ----- ----- ------ ------ ------
Net cash provided by
operating activities..... 542 369 464 92 821 715
----- ----- ----- ------ ------ ------
Cash flows from investing activities:
Purchases of property and equipment... (133) (50) (299) (52) (224) (98)
Proceeds from sale of property and
equipment.......................... -- -- -- 28 -- 28
Net (increase) decrease in amounts due
from employees and related
parties............................ 41 (8) 51 11 22 (35)
----- ----- ----- ------ ------ ------
Net cash used in investing
activities............... (92) (58) (248) (13) (202) (105)
----- ----- ----- ------ ------ ------
Cash flows from financing activities:
Payments on long-term debt............ (50) (42) -- -- -- --
Distributions to stockholders......... (81) (335) (481) -- (449) --
----- ----- ----- ------ ------ ------
Net cash used in financing
activities............... (131) (377) (481) -- (449) --
----- ----- ----- ------ ------ ------
Net increase (decrease) in cash and cash
equivalents........................... 319 (66) (265) 79 170 610
Cash and cash equivalents, beginning of
period................................ 213 532 466 201 466 201
----- ----- ----- ------ ------ ------
Cash and cash equivalents, end of
period................................ $ 532 $ 466 $ 201 $ 280 $ 636 $ 811
===== ===== ===== ====== ====== ======
Supplemental disclosure:
Cash paid for interest................ $ 11 $ 9 $ -- $ -- $ -- $ --
===== ===== ===== ====== ====== ======
</TABLE>

F-42
<PAGE> 107

J. HOWARD & ASSOCIATES, INC.

NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)

(1) NATURE OF OPERATIONS

J. Howard & Associates, Inc. (the "Company") was founded in 1977. The
Company provides instructor-led training to individual managers and client
companies to identify and address potential obstacles to improving workplace
productivity, including race and gender issues, sexual harassment and failure of
employees to take measured risks. Revenue is derived primarily from
instructor-led seminars and, to a lesser extent, from rendering consulting
services.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

Revenue is recognized as products and services are provided.

Use of Estimates

Interim Financial Information

The interim financial statements as of September 30, 1997 and for the nine
months ended September 30, 1996 and 1997, are unaudited, and certain information
and footnote disclosures normally included in the financial statements prepared
in accordance with generally accepted accounting principles, have been omitted.
In the opinion of management, all adjustments consisting only of normal
recurring adjustments necessary to present fairly the financial position,
results of operations and cash flows with respect to the interim financial
statements have been included. The results of operations for the interim periods
are not necessarily indicative of the results for the entire fiscal year.

Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.

Property and Equipment

Property and equipment are stated at cost and depreciated using accelerated
and straight-line methods over periods ranging from three to seven years.
Leasehold improvements are amortized over the term of the lease.

Fair Value of Financial Instruments

Financial instruments of the Company consist primarily of cash and cash
equivalents, accounts receivable, accounts payable and accrued expenses. The
carrying value of these financial instruments approximates their fair value
because of the short maturity of these instruments.

Income Taxes

F-43
<PAGE> 108

J. HOWARD & ASSOCIATES, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

financial statements. Only certain state taxes are paid by its Company. The
Company will terminate its S corporation status concurrently with the
combination described in note 11.

(3) RELATED PARTY TRANSACTIONS

Due from employees and related parties consists of the following at:

<TABLE>
<CAPTION>
DECEMBER 31,
------------- JUNE 30,
1995 1996 1997
---- ---- --------
<S> <C> <C> <C>
Due from The Efficacy Institute, Inc.................. $ 9 $14 $ 7
Due from (to) stockholders............................ 47 (9) (12)
Due from employees.................................... 12 12 11
--- --- ----
68 17 6
=== === ====
</TABLE>

(4) PROPERTY AND EQUIPMENT

Property and equipment consist of the following at:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------- JUNE 30,
1995 1996 1997
---- ------ --------
<S> <C> <C> <C>
Equipment......................................... $512 $ 677 $ 631
Furniture and fixtures............................ 255 255 255
Leasehold improvements............................ 49 49 49
Investment art.................................... 21 21 21
Computer software................................. 16 113 156
Vehicles.......................................... -- 38 38
---- ------ ------
853 1,153 1,150
Accumulated depreciation and amortization......... 683 788 851
---- ------ ------
Property and equipment, net............. $170 $ 365 $ 299
==== ====== ======
</TABLE>

Depreciation and amortization expense related to property and equipment for
the years ended December 31, 1994, 1995 and 1996 was $83, $95 and $104,
respectively, and $75 for the six months ended June 30, 1997.

(5) LINE OF CREDIT

The Company has a secured revolving line of credit agreement which permits
borrowings of up to $500 at the bank's base rate plus one percent. No amounts
were outstanding under this agreement at December 31, 1995, 1996 and June 30,
1997. Substantially all assets of the Company are pledged as collateral under
this agreement.

(6) DISTRIBUTIONS TO STOCKHOLDERS

As discussed in note 2, the stockholders are taxed on their proportionate
share of the Company's taxable income. It has been the Company's policy to make
distributions to the stockholders for the purpose of funding these income tax
obligations.

F-44
<PAGE> 109

J. HOWARD & ASSOCIATES, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(7) LEASE COMMITMENTS

The Company is committed under various noncancelable operating leases for
office space and equipment through January 2002. Lease expense charged to
operations was $239 in 1994, $256 in 1995, $247 in 1996 and $72 for the six
months ended June 30, 1997.

Future minimum lease payments under all noncancelable operating leases are
as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30,
------------------------------------------------------
<S> <C>
1998.................................................. $102
1999.................................................. 71
2000.................................................. 69
2001.................................................. 55
2002.................................................. 35
----
$332
====
</TABLE>

(8) STOCKHOLDERS' EQUITY

During the year ended December 31, 1996, 5,866 shares of Class A common
stock (voting) no par value and 2,934 shares of Class B common stock
(non-voting) no par value were issued 50% each to two new shareholders in
recognition of compensation expense of $111 and $55, respectively.

On June 30, 1995, the Company approved an increase in the authorized common
stock Class A (voting) from 12,500 shares to 100,000 shares and common stock
Class B (non-voting) from 1,000 shares to 25,000 shares. Additionally, the
Company approved an exchange of 40 shares of the newly authorized shares for
each share of the previously authorized shares (or a 40 for 1 stock split). All
share data has been retroactively adjusted to reflect the stock split.

(9) EMPLOYEE BENEFITS

The Company maintains a defined contribution retirement plan for all
eligible employees. Company contributions are at the discretion of the Board of
Directors, but cannot exceed the maximum amount deductible under applicable
provisions of the Internal Revenue Code.

Contributions to the plan during the years ended December 31, 1994, 1995
and 1996 amounted to $23, $34 and $34, respectively. Contributions to the plan
during the six months ended June 30, 1997 totaled $19.

(10) CONCENTRATION OF CREDIT RISK

The Company's three largest customers accounted for approximately 38%, 30%,
63% and 43% of net program revenues for the years ended December 31, 1994, 1995
and 1996 and the six months ended June 30, 1997, respectively. Accounts
receivable from these customers approximated $319, $514 and $532 at December 31,
1995 and 1996 and June 30, 1997, respectively.

The Company maintains cash deposits in two banks located in eastern
Massachusetts and in a money market mutual fund account sponsored by a
registered broker-dealer. Cash deposits in excess of FDIC insurance limits
approximated $140 and $46 at December 31, 1996 and June 30, 1997, respectively.

F-45
<PAGE> 110

J. HOWARD & ASSOCIATES, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(11) SUBSEQUENT EVENTS (UNAUDITED)

In December 1997, the Company entered into a five-year lease of office
space in Burlington, Massachusetts, commencing on April 1, 1998. At that time,
the Company will move its Lexington headquarters to Burlington.

F-46
<PAGE> 111

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Robert Steinmetz, Ph.D., and Associates, Inc.
d/b/a Learning Systems Sciences:

We have audited the accompanying balance sheets of Robert Steinmetz, Ph.D.,
and Associates, Inc., d/b/a Learning Systems Sciences as of June 30, 1997 and
December 31, 1996 and the related statements of operations, stockholders' equity
and cash flows for the six months ended June 30, 1997 and for each of the years
in the two-year period ended December 31, 1996. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Robert Steinmetz, Ph.D., and
Associates, Inc., d/b/a Learning Systems Sciences as of June 30, 1997 and
December 31, 1996 and the results of its operations and its cash flows for the
six months ended June 30, 1997 and for each of the years in the two-year period
ended December 31, 1996 in conformity with generally accepted accounting
principles.

KPMG PEAT MARWICK LLP

Boston, Massachusetts
January 9, 1998

F-47
<PAGE> 112

ROBERT STEINMETZ, PH.D., AND ASSOCIATES, INC.
D/B/A LEARNING SYSTEMS SCIENCES

BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30, SEPTEMBER 30,
1996 1997 1997
------------ -------- -------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.............................. $ 274 $ 599 $ 508
Accounts receivable, net of allowance for doubtful
accounts of $88..................................... 703 729 697
Costs in excess of billings............................ 267 276 359
Prepaid expenses and other current assets.............. 53 81 56
------ ------ ------
Total current assets........................... 1,297 1,685 1,620
------ ------ ------
Property and equipment, net.............................. 129 144 153
Other assets............................................. 103 105 105
------ ------ ------
Total assets................................... $1,529 $1,934 $ 1,878
====== ====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable....................................... $ 64 $ 91 $ 97
Accrued expenses....................................... 166 191 174
Accrued compensation................................... 124 109 100
Billings in excess of costs............................ 710 353 362
------ ------ ------
Total current liabilities...................... 1,064 744 733
------ ------ ------
Commitments and contingencies
Stockholders' equity:
Common stock, $3 par value; 1,000 shares authorized,
issued and outstanding.............................. 3 3 3
Retained earnings...................................... 462 1,187 1,142
------ ------ ------
Total stockholders' equity..................... 465 1,190 1,145
------ ------ ------
Total liabilities and stockholders' equity..... $1,529 $1,934 $ 1,878
====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-48
<PAGE> 113

ROBERT STEINMETZ, PH.D., AND ASSOCIATES, INC.
D/B/A LEARNING SYSTEMS SCIENCES

STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, ENDED SEPTEMBER 30,
----------------- JUNE 30, -----------------
1995 1996 1997 1996 1997
------ ------ ---------- ------ ------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenue..................................... $3,332 $5,123 $2,910 $3,570 $3,960
Cost of revenue............................. 1,390 1,696 1,081 1,230 1,590
------ ------ ------ ------ ------
Gross profit.............................. 1,942 3,427 1,829 2,340 2,370
Selling, general and administrative
expenses.................................. 1,767 3,079 1,108 1,713 1,697
------ ------ ------ ------ ------
Income from operations............ 175 348 721 627 673
------ ------ ------ ------ ------
Other income (expense):
Other..................................... (49) -- -- -- --
Interest income, net...................... 2 9 7 4 12
------ ------ ------ ------ ------
Total other income (expense)...... (47) 9 7 4 12
------ ------ ------ ------ ------
Income before income taxes........ 128 357 728 631 685
Income taxes................................ 86 7 3 1 5
------ ------ ------ ------ ------
Net income........................ $ 42 $ 350 $ 725 $ 630 $ 680
====== ====== ====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-49
<PAGE> 114

ROBERT STEINMETZ, PH.D., AND ASSOCIATES, INC.
D/B/A LEARNING SYSTEMS SCIENCES

STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON STOCK
---------------- RETAINED
SHARES AMOUNT EARNINGS TOTAL
----- ------ -------- ------
<S> <C> <C> <C> <C>
Balance, December 31, 1994.............................. 1,000 $3 $ 70 $ 73
Net income............................................ -- -- 42 42
----- --- ------ ------
Balance, December 31, 1995.............................. 1,000 3 112 115
Net income............................................ -- -- 350 350
----- --- ------ ------
Balance, December 31, 1996.............................. 1,000 3 462 465
Net income............................................ -- -- 725 725
----- --- ------ ------
Balance, June 30, 1997.................................. 1,000 3 1,187 1,190
Net loss.............................................. -- -- (45) (45)
----- --- ------ ------
Balance, September 30, 1997 (Unaudited)................. 1,000 $3 $1,142 $1,145
===== === ====== ======
</TABLE>

See accompanying notes to financial statements.

F-50
<PAGE> 115

ROBERT STEINMETZ, PH.D., AND ASSOCIATES, INC.
D/B/A LEARNING SYSTEMS SCIENCES

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED ENDED
DECEMBER 31, SIX MONTHS ENDED SEPTEMBER 30,
-------------- JUNE 30, ----------------
1995 1996 1997 1996 1997
----- ----- ---------------- ---- -----
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income............................... $ 42 $ 350 $ 725 $630 $ 680
----- ----- ----- ---- -----
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization....... 48 43 25 38 37
Changes in operating assets and
liabilities:
(Increase) decrease in accounts
receivable..................... (467) (195) (26) 44 6
(Increase) decrease in prepaid
expenses and other current
assets......................... 12 (30) (28) (55) (3)
(Increase) decrease in costs in
excess of billings............. (184) 14 (9) 229 (92)
(Increase) decrease in other
assets......................... (17) (19) (2) (19) (2)
Increase (decrease) in accounts
payable and accrued expenses... 50 115 37 (39) 17
Increase (decrease) in billings
in excess of costs............. 560 37 (357) (59) (348)
----- ----- ----- ---- -----
Total adjustments.............. 2 (35) (360) 139 (385)
----- ----- ----- ---- -----
Net cash provided by operating
activities.................. 44 315 365 769 295
----- ----- ----- ---- -----
Cash flows from investing activities:
Purchases of property and equipment...... (84) (85) (40) (59) (61)
----- ----- ----- ---- -----
Net (decrease) increase in cash
and cash equivalents........ (40) 230 325 710 234
Cash and cash equivalents, beginning of
period................................... 84 44 274 44 274
----- ----- ----- ---- -----
Cash and cash equivalents, end of period... $ 44 $ 274 $ 599 $754 $ 508
===== ===== ===== ==== =====
</TABLE>

See accompanying notes to financial statements.

F-51
<PAGE> 116

ROBERT STEINMETZ, PH.D., AND ASSOCIATES, INC.
D/B/A LEARNING SYSTEMS SCIENCES

NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)

(1) NATURE OF OPERATIONS

Robert Steinmetz, Ph.D., and Associates, Inc., d/b/a Learning Systems
Sciences, was founded in 1979. The Company creates customized training products
that generally are designed to facilitate faster learning of customer interface
devices and higher productivity of retail associates. Revenue is derived
primarily from the design, development and delivery of its products.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

The Company follows the percentage-of-completion method of accounting for
contracts. Accordingly, income is recognized in the ratio that costs incurred
bear to estimated total costs. Adjustments to cost estimates are made
periodically, and losses expected to be incurred on contracts in progress are
charged to operations in the period such losses are determined. The aggregate of
costs incurred and income recognized on uncompleted contracts in excess of
related billings is shown as a current asset, and the aggregate of billings on
uncompleted contracts in excess of related costs incurred and income recognized
is shown as a current liability.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Interim Financial Information

Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.

Property and Equipment

Property and equipment are recorded at cost and depreciated using an
accelerated method over periods ranging from five to seven years. Leasehold
improvements are amortized over the term of the lease.

F-52
<PAGE> 117

ROBERT STEINMETZ, PH.D., AND ASSOCIATES, INC.
D/B/A LEARNING SYSTEMS SCIENCES

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

Fair Value of Financial Instruments

Financial instruments of the Company consist primarily of cash and cash
equivalents, accounts receivable, accounts payable and accrued liabilities. The
carrying value of these financial instruments approximates their fair value
because of the short maturity of these instruments.

Income Taxes

Effective August 31, 1995, the Company elected to be treated as an S
corporation. Therefore, the net income of the Company is reported by the
stockholders. Accordingly, no provision for federal income taxes has been
included in the financial statements for the periods subsequent to that date.
Only certain state income taxes are paid by the Company. The Company will
terminate its S corporation status concurrently with the combination described
in note 8.

(3) RELATED PARTY TRANSACTIONS

At June 30, 1997, the Company has unsecured, non-interest bearing loans
receivable from its stockholders in the amount of $22. This amount is included
in prepaid expenses and other current assets.

(4) PROPERTY AND EQUIPMENT

Property and equipment consist of the following at:

<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1996 1997
------------ --------
<S> <C> <C>
Machinery and equipment................................ $248 $283
Furniture and fixtures................................. 48 53
Automobiles............................................ 10 10
Leasehold improvements................................. 12 12
---- ----
318 358
Less accumulated depreciation and amortization......... 189 214
---- ----
Property and equipment, net.................. $129 144
==== ====
</TABLE>

Depreciation and amortization expense related to property and equipment for
the years ended December 31, 1995 and 1996 and the six months ended June 30,
1997 was $48, $43 and $25, respectively.

(5) OPERATING LEASES

Operating lease commitments consist of facility and automobile rentals.
Future minimum lease payments under all noncancelable operating leases are as
follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30,
<S> <C>
1998................................................ $135
1999................................................ 103
----
$238
====
</TABLE>

Lease expense for the years ended December 31, 1995 and 1996 and the six
months ended June 30, 1997 totaled $93, $112 and $57, respectively.

F-53
<PAGE> 118

ROBERT STEINMETZ, PH.D., AND ASSOCIATES, INC.
D/B/A LEARNING SYSTEMS SCIENCES

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(IN THOUSANDS)

(6) EMPLOYEE BENEFITS

The Company has established a profit sharing plan for the benefit of its
employees. Company contributions are made at the discretion of the Board of
Directors. The Company contributed $83 to the plan in 1995. No contribution was
made for the year ended December 31, 1996 or the six months ended June 30, 1997.

(7) CONCENTRATION OF CREDIT RISK

The Company had three customers that accounted for 41% of total revenue and
one customer that accounted for 15% of total revenue for the year ended December
31, 1996 and the six months ended June 30, 1997, respectively. Accounts
receivable from these customers represented approximately 50% and 41% of the
total accounts receivable balance at December 31, 1996 and June 30, 1997,
respectively.

(8) SUBSEQUENT EVENT (UNAUDITED)

F-54
<PAGE> 119

INDEPENDENT AUDITORS' REPORT

The Board of Directors
MOHR Retail Learning Systems, Inc.:

We have audited the accompanying balance sheets of MOHR Retail Learning
Systems, Inc., as of June 30, 1997 and 1996, and the related statements of
operations, stockholders' equity and cash flows for each of the years in the
two-year period ended June 30, 1997. These financial statements are the
responsibility of MOHR Retail Learning Systems, Inc.'s management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of MOHR Retail Learning
Systems, Inc. as of June 30, 1997 and 1996, and the results of its operations
and its cash flows for each of the years in the two-year period ended June 30,
1997, in conformity with generally accepted accounting principles.

KPMG PEAT MARWICK LLP

Boston, Massachusetts
January 9, 1998

F-55
<PAGE> 120

MOHR RETAIL LEARNING SYSTEMS, INC.

BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
JUNE 30,
------------- SEPTEMBER 30,
1996 1997 1997
---- ---- -------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents..................................... $221 $260 $ 211
Accounts receivable, net of allowance for doubtful accounts of
$46 at June 30, 1996 and 1997 and September 30, 1997....... 211 548 441
Inventory..................................................... 99 133 132
Prepaid expenses.............................................. 11 14 22
---- ---- ----
Total current assets.................................. 542 955 806
Property and equipment, net..................................... 18 44 46
---- ---- ----
Total assets.......................................... $560 $999 $ 852
==== ==== ====
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.............................................. $118 $ 74 $ 143
Accrued expenses.............................................. 320 295 304
Accrued compensation.......................................... 12 54 12
Deferred revenue.............................................. 48 73 98
---- ---- ----
Total current liabilities............................. 498 496 557
---- ---- ----
Commitments and contingencies
Stockholders' equity:
Common stock, no par value; 2,500 shares authorized; 100
shares issued and outstanding.............................. 4 4 4
Retained earnings............................................. 58 499 291
---- ---- ----
Total stockholders' equity............................ 62 503 295
---- ---- ----
Total liabilities and stockholders' equity............ $560 $999 $ 852
==== ==== ====
</TABLE>

See accompanying notes to financial statements.

F-56
<PAGE> 121

MOHR RETAIL LEARNING SYSTEMS, INC.

STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
YEAR ENDED ENDED
JUNE 30, SEPTEMBER 30,
----------------- --------------
1996 1997 1996 1997
------ ------ ---- -----
(UNAUDITED)
<S> <C> <C> <C> <C>
Revenue................................................... $2,171 $3,015 $554 $ 556
Cost of revenue........................................... 677 825 187 204
------ ------ ---- -----
Gross profit............................................ 1,494 2,190 367 352
Selling, general and administrative expenses.............. 1,151 1,745 383 562
------ ------ ---- -----
Income (loss) from operations........................... 343 445 (16) (210)
Interest income (expense)................................. (3) 3 -- 3
------ ------ ---- -----
Income (loss) before income taxes....................... 340 448 (16) (207)
State income taxes........................................ 1 7 -- 1
------ ------ ---- -----
Net income (loss)............................... $ 339 $ 441 $(16) $(208)
====== ====== ==== =====
</TABLE>

See accompanying notes to financial statements.

F-57
<PAGE> 122

MOHR RETAIL LEARNING SYSTEMS, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON STOCK
----------------- RETAINED EARNINGS
SHARES AMOUNT (ACCUMULATED DEFICIT) TOTAL
------ ------ --------------------- -----
<S> <C> <C> <C> <C>
Balance, June 30, 1995......................... 100 $ 4 $(281) $(277)
Net income................................... -- -- 339 339
--- --- ----- -----
Balance, June 30, 1996......................... 100 4 58 62
Net income................................... -- -- 441 441
--- --- ----- -----
Balance, June 30, 1997......................... 100 4 499 503
Net loss..................................... -- -- (208) (208)
--- --- ----- -----
Balance, September 30, 1997 (Unaudited)........ 100 $ 4 $ 291 $ 295
=== === ===== =====
</TABLE>

See accompanying notes to financial statements.

F-58
<PAGE> 123

MOHR RETAIL LEARNING SYSTEMS, INC.

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
YEAR ENDED ENDED
JUNE 30, SEPTEMBER 30,
--------------- ---------------
1996 1997 1996 1997
----- ----- ----- -----
(UNAUDITED)
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Net income (loss)....................................... $ 339 $ 441 $ (16) $(208)
----- ----- ----- -----
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization...................... 10 15 2 4
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable...... (99) (337) (107) 107
(Increase) decrease in inventory................ 4 (34) (12) 1
(Increase) decrease in prepaid expenses......... 3 (3) (9) (8)
Increase (decrease) in accounts payable......... (1) (44) (23) 69
Increase in accrued expenses.................... (15) 17 (6) (33)
Increase (decrease) in deferred revenue......... (29) 25 46 25
----- ----- ----- -----
Total adjustments............................. (127) (361) (109) 165
----- ----- ----- -----
Net cash provided by (used in) operating
activities................................. 212 80 (125) (43)
----- ----- ----- -----
Cash flows from investing activities:
Purchases of property and equipment..................... (8) (41) (8) (6)
----- ----- ----- -----
Net cash used in investing activities......... (8) (41) (8) (6)
----- ----- ----- -----
Net increase (decrease) in cash and cash equivalents...... 204 39 (133) (49)
Cash and cash equivalents, beginning of period............ 17 221 221 260
----- ----- ----- -----
Cash and cash equivalents, end of period.................. $ 221 $ 260 $ 88 $ 211
===== ===== ===== =====
Supplemental disclosure:
Cash paid for interest.................................. $ -- $ 3 $ -- $ 3
===== ===== ===== =====
</TABLE>

See accompanying notes to financial statements.

F-59
<PAGE> 124

MOHR RETAIL LEARNING SYSTEMS, INC.

NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)

(1) NATURE OF OPERATIONS

MOHR Retail Learning Systems, Inc. (the "Company") was founded in 1991. The
Company offers train-the-trainer seminars to help clients in the retail industry
to improve productivity by fostering a customer oriented focus at the sales
management and associate levels. In some of its programs, the Company trains
employees directly through instructor-led seminars. Revenue is derived primarily
from the licensing to clients of the right to use the Company's training
programs. Revenue is received on a participant or site basis.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

Revenue is recognized as services are performed. The Company contracts with
customers to provide materials and training seminars. Deferred revenue is
recognized for payments received prior to services being performed.

Use of Estimates

Interim Financial Information

Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.

Inventory

The Company owns training supplies and manuals which are accounted for
using the lower of cost first-in, first-out (FIFO) or market basis of
accounting.

Property and Equipment

Property and equipment are stated at cost and depreciated using an
accelerated method over five years. Leasehold improvements are amortized over
the term of the lease.

F-60
<PAGE> 125

MOHR RETAIL LEARNING SYSTEMS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Fair Value of Financial Instruments

The Company's financial instruments consist primarily of cash and cash
equivalents, accounts receivable, accounts payable and accrued expenses. The
carrying amount of these financial instruments approximates fair value because
of the short maturity of those instruments.

Income Taxes

(3) PROPERTY AND EQUIPMENT

Property and equipment consist of the following at:

<TABLE>
<CAPTION>
JUNE 30,
-------------
1996 1997
---- ----
<S> <C> <C>
Equipment...................................................... $34 61
Furniture...................................................... 9 19
Leasehold improvements......................................... -- 4
--- ---
43 84
Accumulated depreciation and amortization...................... 25 40
--- ---
Property and equipment, net.......................... $18 44
=== ===
</TABLE>

Depreciation and amortization expense related to property and equipment was
$10 and $15 in the years ended June 30, 1996 and 1997, respectively.

(4) LEASE COMMITMENTS

The Company is committed under various noncancelable operating leases for
office space and equipment through February 2000. Lease expense for the years
ended June 30, 1996 and 1997 was $18 and $34, respectively. Future minimum lease
payments under all noncancelable operating leases are as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30,
<S> <C>
1998............................................. $41
1999............................................. 40
2000............................................. 1
---
Total....................................... $82
===
</TABLE>

(5) EMPLOYEE BENEFITS

Eligible employees of the Company participate in a profit sharing plan
sponsored by the Company. The Plan provides that the Company make discretionary
contributions to the Plan. The Company made contributions of $145 and $104 for
the years ended June 30, 1996 and 1997, respectively.

F-61
<PAGE> 126

MOHR RETAIL LEARNING SYSTEMS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(6) CONCENTRATION OF CREDIT RISK

The Company's credit risks primarily relate to cash and cash equivalents
and accounts receivable. Cash and cash equivalents are primarily held in bank
accounts. Cash deposits in excess of FDIC insurance limits approximated $108 at
June 30, 1997. The Company has not incurred losses related to these balances to
date.

For the year ended June 30, 1996, the Company had one customer that
accounted for 11 percent of total revenue. For the year ended June 30, 1997, no
customer represented greater than 10 percent of total revenue.

(7) LITIGATION

The Company is involved in legal actions arising in the ordinary course of
business. Management believes that adequate provision has been made for any
liabilities which may result from such matters.

(8) SUBSEQUENT EVENT (UNAUDITED)

F-62
<PAGE> 127

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Novations Group, Inc.:

We have audited the accompanying balance sheets of Novations Group, Inc.,
as of June 30, 1997 and 1996, and the related statements of operations,
stockholders' equity, and cash flows for each of the years in the three-year
period ended June 30, 1997. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. The audit includes examining on a test basis evidence supporting
the amounts and disclosures in the financial statements. The audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Novations Group, Inc., as of
June 30, 1997 and 1996, and the results of its operations and its cash flows for
each of the years in the three-year period ended June 30, 1997 in conformity
with generally accepted accounting principles.

KPMG Peat Marwick LLP

Boston, Massachusetts
January 9, 1998

F-63
<PAGE> 128

NOVATIONS GROUP, INC.

BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
JUNE 30,
----------------- SEPTEMBER 30,
1996 1997 1997
------ ------ -------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.................................. $ 17 $ 88 $ 446
Accounts receivable, net of allowance for doubtful accounts
of $158................................................. 1,976 2,202 2,364
Receivable from related parties............................ 179 414 341
Prepaid expenses........................................... 63 115 50
------ ------ ------
Total current assets............................... 2,235 2,819 3,201
Property and equipment, net.................................. 552 492 456
------ ------ ------
Total assets....................................... $2,787 $3,311 $ 3,657
====== ====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of notes payable........................... 1,079 1,298 1,078
Accounts payable........................................... 225 118 174
Accrued compensation....................................... 836 803 1,270
Accrued expenses........................................... 275 177 135
------ ------ ------
Total current liabilities.......................... 2,415 2,396 2,657
------ ------ ------
Notes payable................................................ 459 361 361
Commitments and contingencies
Stockholders' equity:
Common stock, $1.00 par value; 1,000,000 shares authorized;
922, 1,000 and 1,000 shares issued and outstanding at
June 30, 1996, 1997 and September 30, 1997,
respectively............................................ 1 1 1
Retained earnings.......................................... (88) 553 638
------ ------ ------
Total stockholders' equity......................... (87) 554 639
------ ------ ------
Total liabilities and stockholders' equity......... $2,787 $3,311 $ 3,657
====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-64
<PAGE> 129

NOVATIONS GROUP, INC.

STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED JUNE 30, SEPTEMBER 30,
---------------------------- -----------------
1995 1996 1997 1996 1997
------ ------ ------ ------ ------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenue....................................... $7,175 $9,039 $9,018 $2,167 $2,464
Cost of revenue............................... 3,885 4,733 4,839 1,117 1,197
------ ------ ------ ------ ------
Gross profit........................ 3,290 4,306 4,179 1,050 1,267
Selling, general, and administrative
expenses.................................... 3,167 4,094 3,315 823 1,088
------ ------ ------ ------ ------
Income from operations.............. 123 212 864 227 179
------ ------ ------ ------ ------
Interest expense, net......................... 98 98 137 43 83
Income before income taxes.......... 25 114 727 184 96
Income taxes.................................. 22 40 20 -- 11
------ ------ ------ ------ ------
Net income.......................... $ 3 $ 74 $ 707 $ 184 $ 85
====== ====== ====== ====== ======
</TABLE>

See accompanying notes to financial statements.

F-65
<PAGE> 130

NOVATIONS GROUP, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
RETAINED
COMMON STOCK EARNINGS
----------------- (ACCUMULATED
SHARES AMOUNT DEFICIT) TOTAL
------ ------ ------------ -----
<S> <C> <C> <C> <C>
Balance, June 30, 1994............................... 896 $ 1 $ (45) $ (44)
Net income......................................... -- -- 3 3
Distributions to stockholders...................... -- -- (79) (79)
----- --- ----- -----
Balance, June 1995................................... 896 1 (121) (120)
Net income......................................... -- -- 74 74
Distributions to stockholders...................... -- -- (26) (26)
Stock issued....................................... 63 -- -- --
Stock buy back..................................... (37) -- (15) (15)
----- --- ----- -----
Balance, June 30, 1996............................... 922 1 (88) (87)
Net income......................................... -- -- 707 707
Distributions to stockholders...................... -- -- (66) (66)
Stock issued....................................... 78 -- -- --
----- --- ----- -----
Balance, June 30, 1997............................... 1,000 1 553 554
Net income......................................... -- -- 85 85
----- --- ----- -----
Balance, September 30, 1997 (Unaudited).............. 1,000 $ 1 $ 638 $ 639
===== === ===== =====
</TABLE>

See accompanying notes to financial statements.

F-66
<PAGE> 131

NOVATIONS GROUP, INC.

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED JUNE 30, SEPTEMBER 30,
--------------------- -------------
1995 1996 1997 1996 1997
----- ----- ----- ----- -----
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income............................................. $ 3 $ 74 $ 707 $ 184 $ 85
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization....................... 203 167 197 45 45
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable........ (670) (357) (226) (92) (162)
(Increase) decrease in prepaid expenses and other
current assets................................. (250) 86 (287) (45) 138
Increase (decrease) in accounts payable and
accrued expenses............................... 358 (88) (238) 165 481
---- ---- ---- ---- ----
Total adjustments.............................. (359) (192) (554) 73 502
---- ---- ---- ---- ----
Net cash (used by) provided by operating
activities................................... (356) (118) 153 257 587
---- ---- ---- ---- ----
Cash flows from investing activities:
Purchases of property and equipment.................... (217) (427) (137) (143) (9)
---- ---- ---- ---- ----
Cash flows from financing activities:
Net repayments/proceeds from long-term debt............ 340 117 121 2 (220)
Capital distribution................................... (40) (41) (66) -- --
---- ---- ---- ---- ----
Net cash provided by financing activities...... 300 76 55 2 (220)
---- ---- ---- ---- ----
Net (decrease) increase in cash and cash equivalents..... (273) (469) 71 116 358
Cash and cash equivalents, beginning of period........... 759 486 17 17 88
---- ---- ---- ---- ----
Cash and cash equivalents, end of period................. $ 486 $ 17 $ 88 $ 133 $ 446
==== ==== ==== ==== ====
Supplemental disclosure:
Cash paid for interest................................. $ 120 $ 120 $ 151 $ 47 $ 87
==== ==== ==== ==== ====
</TABLE>

See accompanying notes to financial statements.

F-67
<PAGE> 132

NOVATIONS GROUP, INC.

NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)

(1) NATURE OF OPERATIONS

Novations Group, Inc. (the "Company") was founded in 1986. The Company
assists clients in, among other things, clarifying and communicating their
business strategies and re-designing their organizations and work systems.
Revenue is derived primarily from fees for professional services and, to a
lesser extent, from the sale of services and products to support human resources
management.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

Revenue is recognized as services are performed and products are provided.

Use of Estimates

The preparation of financial statements, in conformity with generally
accepted accounting principles, requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Interim Financial Information

Cash Equivalents

The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents.

Property and Equipment

Property and equipment are stated at cost and depreciated using the
straight-line method over periods ranging from five to seven years. Leasehold
improvements are amortized over the term of the lease.

Fair Value of Financial Instruments

Financial instruments of the Company consist of cash, marketable
securities, accounts receivable, accounts payable and accrued liabilities and
debt. The carrying value of these financial instruments approximates their fair
value due to the short maturity of these instruments. The carrying value of debt
approximates fair value because the interest rates on the debt approximate the
rates currently available to the Company.

F-68
<PAGE> 133

NOVATIONS GROUP, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Income Taxes

(3) RELATED PARTY TRANSACTIONS

The Company advanced cash to an entity controlled by the stockholders of
the Company. The balance due to the Company as of June 30, 1996, 1997 and
September 30, 1997 was $140, $332 and $192, respectively. Also included in
receivables from related parties are employee advances of $39, $82 and 149 at
June 30, 1996, 1997 and September 30, 1997, respectively.

The Company leases certain office facilities from a partnership controlled
by the Company's stockholders.

The terms of the lease require annual payments of $300,000, increasing by
3% per year, through March 2002. The Company has an option to renew the lease
for an additional five-year term. The Company has guaranteed a $1.2 million note
payable to a financial institution by the partnership.

(4) PROPERTY AND EQUIPMENT

Property and equipment consist of the following at:

<TABLE>
<CAPTION>
JUNE 30,
-----------------
1996 1997
------ ------
<S> <C> <C>
Computer equipment and software............................ $ 922 945
Leasehold improvements..................................... 167 198
Office equipment........................................... 108 170
Furniture and fixtures..................................... 94 115
------ ------
1,291 1,428
Accumulated depreciation and amortization.................. 739 936
------ ------
Property and equipment, net........................... $ 552 492
====== ======
</TABLE>

Depreciation and amortization expense related to property and equipment for
the years ended June 1995, 1996 and 1997, was $203, $167 and $197, respectively.

(5) NOTES PAYABLE

Notes payable consist of notes to former stockholders, with interest
imputed at 8.75%. Payments are due monthly or annually through March 2002.

Aggregate maturities required on these notes at June 30, are as follows:

<TABLE>
<S> <C>
1998.................................................... $ 59
1999.................................................... 97
2000.................................................... 98
2001.................................................... 98
2002.................................................... 68
-----
-
Total.............................................. $420
======
</TABLE>

F-69
<PAGE> 134

NOVATIONS GROUP, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(6) OPERATING LEASES

The Company leases all of its facilities and certain office equipment under
cancelable and noncancelable operating leases that expire on various dates
through 2003.

Future minimum lease payments under all noncancelable operating leases,
including leases to related parties, are as follows:

<TABLE>
<CAPTION>
YEAR ENDING JUNE 30:
------------------------------------------------------------
<S> <C>
1998.................................................. $ 585
1999.................................................. 654
2000.................................................. 632
2001.................................................. 534
2002.................................................. 334
Thereafter............................................ 48
------
Total............................................ $2,787
======
</TABLE>

Lease expense for the years ended June 30, 1995, 1996 and 1997 was $71,
$211 and $385, respectively.

(7) LINE OF CREDIT

The Company has a $1,500 line of credit agreement with a bank, with
interest payable at the bank's prime rate. The interest rate at June 30, 1996
and 1997 was 10 percent. The line of credit is secured by substantially all of
the Company's assets and is guaranteed by the principal stockholders of the
Company.

The Company had $1,000 and $1,239 at June 30, 1996 and 1997, respectively,
outstanding under the agreement.

(8) EMPLOYEE BENEFITS

The Company has a 401(k) plan in which it matches 50% of employee
contributions up to a maximum of 4%. The Company contributed $44, $60 and $75 to
the plan for the years ended June 30, 1995, 1996 and 1997, respectively.

(9) CONCENTRATION OF CREDIT RISK

For the year ended June 30, 1995, the Company had two customers that each
accounted for greater than 10 percent of revenue. For each of the years ended
June 30, 1996 and 1997, the Company had one customer that accounted for greater
than 10 percent of revenue.

(10) SUBSEQUENT EVENT (UNAUDITED)

In February 1998, the Company entered into a definitive merger agreement
with Provant, Inc. ("Provant") and one of its subsidiaries, whereby Provant
will acquire the Company upon completion of the proposed initial public
offering.

F-70
<PAGE> 135

INDEPENDENT AUDITOR'S REPORT

Board of Directors
Star Mountain, Inc. and Subsidiaries:

We have audited the accompanying consolidated balance sheets of Star
Mountain, Inc. and Subsidiaries as of December 31, 1995 and 1996, and June 30,
1997, and the related consolidated statements of operations, stockholders'
equity, and cash flows for each of the years in the three year period ended
December 31, 1996, and the six month period ended June 30, 1997. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Star Mountain,
Inc. and Subsidiaries as of December 31, 1995 and 1996, and June 30, 1997, and
the consolidated results of their operations and their cash flows for each of
the years in the three year period ended December 31, 1996, and the six month
period ended June 30, 1997, in conformity with generally accepted accounting
principles.

Friedman & Fuller, P.C.

Rockville, Maryland
December 5, 1997

F-71
<PAGE> 136

STAR MOUNTAIN, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------------- JUNE 30, SEPTEMBER 30,
1995 1996 1997 1997
------------ ------------ -------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
ASSETS
Current assets:
Cash.......................................... $ 4 $ 39 $ 233 $ 275
Accounts receivable........................... 3,758 4,395 5,240 4,573
Current portion of notes receivable, related
parties.................................... 60 181 307 344
Inventory..................................... -- 100 161 151
Other current assets.......................... 36 71 170 122
Deferred income taxes......................... -- 29 42 42
------ ------ ------ ------
Total current assets.................. 3,858 4,815 6,153 5,507
------ ------ ------ ------
Property and equipment:
Furniture and fixtures........................ 69 65 531 672
Office equipment.............................. 611 746 1,406 1,444
Computer software............................. 69 69 75 91
Leasehold improvements........................ 15 16 81 86
Automobiles................................... 21 31 31 41
------ ------ ------ ------
785 927 2,124 2,334
Less accumulated depreciation and
amortization............................... 385 423 1,416 1,482
------ ------ ------ ------
400 504 708 852
------ ------ ------ ------
Other assets:
Notes receivable, related parties, net of
current portion............................ 292 267 317 317
Other assets.................................. 71 140 318 604
Land held for investment...................... -- 110 110 110
Goodwill, net of accumulated amortization of
$16, $23, $40, and $51..................... 154 147 918 897
------ ------ ------ ------
517 664 1,663 1,928
------ ------ ------ ------
$4,775 $5,983 $8,524 $ 8,287
====== ====== ====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Note payable, bank............................ $ 991 $ 905 $1,144 $ 1,360
Current portion of notes payable.............. 35 95 222 132
Accounts payable.............................. 1,127 1,295 2,028 1,645
Accrued expenses.............................. 439 573 732 814
Billings in excess of costs and earnings...... 324 1,076 1,681 1,269
------ ------ ------ ------
Total current liabilities............. 2,916 3,944 5,807 5,220
------ ------ ------ ------
Long-term liabilities:
Notes payable, net of current portion......... -- -- 379 379
Deferred income taxes......................... -- 29 126 126
------ ------ ------
Total long-term liabilities........... -- 29 505 505
------ ------ ------
Total liabilities..................... 2,916 3,973 6,312 5,725
------ ------ ------ ------
Commitments and contingencies
Stockholders' equity:
Common stock.................................. 8 8 2,098 2,102
Additional paid-in capital.................... 1,991 2,058 -- --
Retained earnings (deficit)................... (75) 529 740 1,086
------ ------ ------ ------
1,924 2,595 2,838 3,188
Less common stock held in treasury at cost.... (65) (585) (626) (626)
------ ------ ------ ------
1,859 2,010 2,212 2,562
------ ------ ------ ------
$4,775 $5,983 $8,524 $ 8,287
====== ====== ====== ======
</TABLE>

See accompanying notes to consolidated financial statements

F-72
<PAGE> 137

STAR MOUNTAIN, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, ENDED SEPTEMBER 30,
------------------------------------------ JUNE 30, -----------------------------
1994 1995 1996 1997 1996 1997
------------ ------------ ------------ ---------- ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Revenue................. $9,731 $ 14,306 $ 16,313 $ 11,331 $11,785 $17,101
Direct costs............ 6,350 8,668 9,457 7,204 6,559 10,588
------ ------- ------- ------- ------- -------
Gross profit.......... 3,381 5,638 6,856 4,127 5,226 6,513
Operating expenses...... 2,973 4,411 5,476 3,674 4,085 5,647
------ ------- ------- ------- ------- -------
Income from
operations............ 408 1,227 1,380 453 1,141 866
------ ------- ------- ------- ------- -------
Other income (expense):
Interest income....... 25 19 25 37 7 100
Interest expense...... (86) (54) (65) (80) (45) (87)
Other, net............ (133) (200) (339) (74) (137) 9
------ ------- ------- ------- ------- -------
(194) (235) (379) (117) (175) 22
------ ------- ------- ------- ------- -------
Income before income
taxes................. 214 992 1,001 336 966 888
Income taxes............ 0 0 397 125 360 331
------ ------- ------- ------- ------- -------
Net income.............. $ 214 $ 992 $ 604 $ 211 $ 606 $ 557
====== ======= ======= ======= ======= =======
</TABLE>

See accompanying notes to consolidated financial statements
F-73
<PAGE> 138

STAR MOUNTAIN, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL RETAINED TREASURY STOCK
------------------ PAID-IN EARNINGS -------------------
SHARES AMOUNT CAPITAL (DEFICIT) SHARES AMOUNT TOTAL
--------- ------ ---------- -------- ---------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1993..... 729,257 $ 7 $ 1,916 $ (902) -- $ -- $1,021
Issuance of common stock upon
exercise of options.......... 11,595 1 39 -- -- -- 40
Net income..................... -- -- -- 214 -- -- 214
--------- ------ ------- ------ ---------- ----- ------
Balance, December 31, 1994..... 740,852 8 1,955 (688) -- -- 1,275
Issuance of common stock upon
exercise of options.......... 11,827 -- 36 -- -- -- 36
Distributions to
shareholders................. -- -- -- (379) -- -- (379)
Purchase of treasury stock..... -- -- -- -- 22,700 (65) (65)
Net income..................... -- -- -- 992 -- -- 992
--------- ------ ------- ------ ---------- ----- ------
Balance, December 31, 1995..... 752,679 8 1,991 (75) 22,700 (65) 1,859
Issuance of common stock upon
exercise of options.......... 9,414 -- 67 -- -- -- 67
Purchase of treasury stock..... -- -- -- -- 65,671 (520) (520)
Net income..................... -- -- -- 604 -- -- 604
--------- ------ ------- ------ ---------- ----- ------
Balance, December 31, 1996..... 762,093 8 2,058 529 88,371 (585) 2,010
Issuance of common stock upon
exercise of options.......... 87,621 32 -- -- -- -- 32
Purchase of treasury stock..... -- -- -- -- 12,584 (41) (41)
Stock split, conversion to no
par stock.................... 7,272,518 2,058 (2,058) -- 1,110,505 -- --
Net income..................... -- -- -- 211 -- -- 211
--------- ------ ------- ------ ---------- ----- ------
Balance, June 30, 1997......... 8,122,232 2,098 0 740 1,211,460 (626) 2,212
Issuance of common stock upon
exercise of options.......... 5,100 4 -- -- -- -- 4
Net income (unaudited)......... -- -- -- 346 -- -- 346
--------- ------ ------- ------ ---------- ----- ------
Balance, September 30, 1997
(unaudited).................. 8,127,332 $2,102 $ 0 $1,086 1,211,460 $(626) $2,562
========= ====== ======= ====== ========== ===== ======
</TABLE>

See accompanying notes to consolidated financial statements
F-74
<PAGE> 139

STAR MOUNTAIN, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, ENDED SEPTEMBER 30,
----------------------------- JUNE 30, ------------------------
1994 1995 1996 1997 1996 1997
------- -------- -------- ---------- -------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Cash received from customers............ $ 9,381 $ 13,419 $ 16,428 $ 11,189 $ 12,742 $ 17,626
Cash paid to suppliers and employees.... (9,401) (12,620) (14,890) (10,210) (10,862) (16,354)
Interest received....................... 25 19 25 37 7 100
Interest paid........................... (86) (54) (65) (80) (45) (87)
Income taxes paid....................... -- -- (420) (96) (358) (286)
------- -------- -------- -------- -------- --------
Net cash provided by (used in)
operating activities.......... (81) 764 1,078 840 1,484 999
------- -------- -------- -------- -------- --------
Cash flows from investing activities:
Issuance of notes receivable............ (113) (64) (96) (176) (247) (213)
Acquisition of property and equipment... (60) (159) (61) (79) (41) (289)
Business acquisitions................... -- (100) (300) (621) (300) (621)
Purchase of land held for investment.... -- -- (110) -- (110) --
Other................................... 174 (8) 2 -- 15 --
------- -------- -------- -------- -------- --------
Net cash provided by (used in)
investing activities.......... 1 (331) (565) (876) (683) (1,123)
------- -------- -------- -------- -------- --------
Cash flows from financing activities:
Net borrowings (payments) on
line-of-credit....................... 122 (15) (86) 239 (241) 455
Principal payments on long-term debt.... (178) -- -- -- -- (90)
Proceeds from other notes payable....... 100 25 95 -- -- --
Payments on other notes payable......... (3) (34) (35) -- (35) --
Proceeds from issuance of common
stock................................ 39 35 68 32 33 36
Purchase of treasury stock.............. -- (65) (520) (41) (520) (41)
Distributions to shareholders........... -- (378) -- -- -- --
------- -------- -------- -------- -------- --------
Net cash provided by (used in)
financing activities.......... 80 (432) (478) 230 (763) 360
------- -------- -------- -------- -------- --------
Net increase (decrease) in cash........... 0 1 35 194 38 236
Cash, beginning of year................... 3 3 4 39 4 39
------- -------- -------- -------- -------- --------
Cash, end of year......................... $ 3 $ 4 $ 39 $ 233 $ 42 $ 275
======= ======== ======== ======== ======== ========
</TABLE>

See accompanying notes to consolidated financial statements
F-75
<PAGE> 140

STAR MOUNTAIN, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(IN THOUSANDS)

<TABLE>
<CAPTION>
SIX MONTHS NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, ENDED SEPTEMBER 30,
------------------------ JUNE 30, ----------------------
1994 1995 1996 1997 1996 1997
----- ------- ------ ---------- ------ -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Reconciliation of net income to net cash provided
by (used in) operating activities:
Net income..................................... $ 214 $ 992 $ 604 $ 211 $ 606 $ 557
----- ------- ----- ----- ------ -----
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization.................. 72 96 139 110 92 197
Loss on sale of assets......................... -- -- 4 12 4 12
Deferred income taxes.......................... -- -- -- 17 -- 17
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable......................... (344) (1,053) (637) (142) 372 525
Inventory................................... -- -- 18 (61) (45) (51)
Other current assets........................ (3) 47 (34) (62) 5 (14)
Other assets................................ (2) (25) (69) (105) (275) (391)
Increase (decrease) in:
Accounts payable............................ (45) 425 168 474 50 86
Accrued expenses............................ 33 116 133 (219) 90 (132)
Billings in excess of costs and anticipated
profits................................... (6) 166 752 605 585 193
----- ------- ----- ----- ------ -----
Total adjustments.............................. (295) (228) 474 629 878 442
----- ------- ----- ----- ------ -----
Net cash provided by (used in) operating
activities.................................. $ (81) $ 764 $1,078 $ 840 $1,484 $ 999
===== ======= ===== ===== ====== =====
</TABLE>

Non cash investing and financing activities: During the period ended June 30,
1997, the Company issued a note payable for $506,000 for a portion of the
purchase price of ORA.

See accompanying notes to consolidated financial statements
F-76
<PAGE> 141

STAR MOUNTAIN, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS)

(1) NATURE OF OPERATIONS

Star Mountain, Inc. (the "Company") was founded in 1987. The Company is
primarily engaged in contracting with the U.S. Government to provide technical
and professional services in the form of computer-based training, software
development and computer applications support. In August 1996, the Company
formed a wholly-owned subsidiary, Star Digital, Inc. ("Star") to acquire the
assets of Computer Visions, Inc. Star is primarily a value added distributor of
computer equipment. In February 1997, the Company acquired the stock of Odyssey
Research Associates, Inc. ("ORA"). ORA is primarily engaged in contracting with
the U.S. Government to perform research relating to computer access and
security. ORA includes the accounts of 168004 Canada, Inc. ("ORA Canada"), a
wholly-owned subsidiary. ORA Canada performs similar contracts for the Canadian
Government.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

A major portion of the Company's revenue results from services performed
under U.S. government contracts, either directly or through subcontracts. The
majority of the Company's contracts are fixed-price contracts. Revenue on fixed
price contracts is recognized using the percentage of completion method based on
costs incurred in relation to total estimated costs. Revenue on
time-and-materials contracts is recognized to the extent of fixed billable rates
for hours delivered plus reimbursable costs. Revenue on cost-plus-fee contracts
is recognized based on reimbursable costs incurred plus estimated fees earned
thereon. At the time it is recognized that it is probable that a contract will
result in a loss and the loss can be reasonably estimated, the entire estimated
loss is included in the determination of net income. In accordance with industry
practice, amounts relating to long-term contracts are classified as current
assets although an indeterminable portion of these amounts is not expected to be
realized within one year.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Interim Financial Information

The interim financial statements as of September 30, 1997, and for the nine
months ended September 30, 1996 and 1997, are unaudited, and certain information
and footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles, have been omitted. In
the opinion of management, all adjustments, consisting only of normal recurring
adjustments necessary to present fairly the financial position, results of
operations and cash flows with respect to the interim financial statements have
been included. The results of operations for the interim periods are not
necessarily indicative of the results for the entire fiscal year.

Credit Risk

The Company's accounts receivable consist principally of unsecured amounts
due from the U.S. Government.

Cash Equivalents

Cash equivalents are defined as highly liquid short-term investments whose
maturity dates do not extend past three months from the original date of
purchase. The Company has held no such instruments.

F-77
<PAGE> 142

STAR MOUNTAIN, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Property and Equipment

Property and equipment are stated at cost and include additions and major
replacements or betterments. Depreciation and amortization are provided for in
amounts which amortize the cost of properties utilizing the straight-line method
over estimated useful lives of three to seven years. Maintenance, repairs and
minor renewals are expensed as incurred. Any gain or loss on disposition is
included in the determination of net income.

Goodwill

Goodwill represents the excess of the cost of business acquisitions,
accounted for by the purchase method, over the fair value of the net assets
thereof. Goodwill is being amortized on a straight-line basis principally over
14 years.

Fair Value of Financial Instruments

Financial instruments of the Company consist primarily of cash and cash
equivalents, accounts receivable, note payable, bank, accounts payable and
accrued expenses. The carrying value of these financial instrument approximates
their fair value because of the short maturity of these instruments.

Income Taxes

Through December 31, 1995, the Company had elected to be taxed as an S
Corporation and, accordingly, the financial statements for 1994 and 1995 do not
reflect any provision for income taxes since elements of income and deduction
passed through directly to the shareholders. Effective January 1, 1996, the
Company terminated its election to be taxed as an S corporation.

Deferred income tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial reporting and
tax bases of assets and liabilities. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be settled. Future
tax benefits recognized as deferred tax assets must be reduced by a valuation
allowance where it is more likely than not that the benefits may not be
realized.

(3) ACQUISITIONS

On June 19, 1995, the Company acquired all of the assets of BZ Academy,
Inc. (BZ). The acquisition has been accounted for as a purchase and has operated
as the AIT division of the Company. Tangible assets were recorded at their book
value at the date of purchase, which approximated their fair value. The
difference between the purchase price and the assets' book value was recorded as
goodwill.

On August 1, 1996, the Company formed a new corporation, Star Digital,
Inc., to acquire the assets of Computer Visions, Inc. The acquisition has been
accounted for as a purchase. Computer Visions' tangible assets were recorded at
their fair value, which approximated the purchase price. No goodwill was
recorded.

On February 21, 1997, the Company acquired the outstanding stock of ORA.
The acquisition has been accounted for as a purchase. The excess of the purchase
price over the book value of the net assets of ORA at the purchase date has been
recorded as goodwill.

On September 30, 1997, the Company acquired certain assets of Simms
Industries. The assets acquired consisted primarily of accounts receivable and
fixed assets.

F-78
<PAGE> 143

STAR MOUNTAIN, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

See Note 13 regarding an additional acquisition after September 30, 1997,
and the pro forma acquisition information.

(4) ACCOUNTS RECEIVABLE

Accounts receivable consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------- JUNE 30, SEPTEMBER 30,
1995 1996 1997 1997
------ ------ -------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
Government contracts:
Billed................................... $2,304 $3,333 $3,961 $ 3,268
Unbilled................................. 958 698 833 896
Other...................................... 496 364 446 409
------ ------ ------ ------
$3,758 $4,395 $5,240 $ 4,573
====== ====== ====== ======
</TABLE>

Included in unbilled accounts receivable are retainages due upon completion
of the contracts of approximately $54, $65, $70, and $55.

(5) NOTES RECEIVABLE

Notes receivable consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
------------- JUNE 30, SEPTEMBER 30,
1995 1996 1997 1997
---- ---- -------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
Due to/from majority shareholder, unsecured
interest at prime, due December 1997........ $ 10 $131 $307 $ 344
Due from former employee, secured, interest at
10 percent, due December 31, 1998........... 342 317 317 317
---- ---- ---- ----
352 448 624 661
Less current portion.......................... 60 181 307 344
---- ---- ---- ----
$292 $267 $317 $ 317
==== ==== ==== ====
</TABLE>

(6) NOTE PAYABLE, BANK

The Company maintains a bank line of credit arrangement that provides for
borrowings of 90% of billed accounts receivable less than 90 days old, not to
exceed $3,500 in total. Advances bear interest at LIBOR plus 250 basis points.
The line is collateralized by substantially all of the Company's assets. The
agreement requires the Company to meet certain covenants including limitations
on dividends, and maintenance of adjusted tangible net worth, as defined. The
Company has been in compliance with the lender's covenants during each of the
periods presented. At December 31, 1995 and 1996, June 30, 1997, and September
30, 1997, overdrafts in the payroll and operating bank accounts amounting to
$722, $236, $346, and $217, respectively, have been included in the outstanding
balance on the line since such overdrafts are automatically covered by the bank
as checks are presented for payment.

F-79
<PAGE> 144

STAR MOUNTAIN, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(7) OTHER NOTES PAYABLE

<TABLE>
<CAPTION>
DECEMBER
31,
----------- JUNE 30, SEPTEMBER 30,
1995 1996 1997 1997
---- ---- -------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
Note payable, shareholder, representing temporary
advances of working capital, interest at LIBOR plus
250 basis points, due on demand. Unsecured.......... $35 $95 $ 95 $ 5
Note payable, purchase of subsidiary, ORA, interest at
9%, payable in four annual installments of $126,500
beginning February 1998. ........................... -- -- 506 506
--- --- ---- ----
Total................................................. 35 95 601 511
Less current portion.................................. 35 95 222 132
--- --- ---- ----
Long-term portion..................................... $ 0 $ 0 $379 $ 379
=== === ==== ====
</TABLE>

(8) EMPLOYEE BENEFITS

The Company has a 401(k) plan in which it matches 50% of employee
contributions, up to a maximum of 3% of each employee's gross annual
compensation. In addition, the Company may contribute a discretionary amount
annually. Total expense under the plan for the years ended December 31, 1994,
1995 and 1996, was $97, $121, and $123, respectively. Expense for the periods
ended June 30, 1997, September 30, 1996, and September 30, 1997, was $47, $91
and $75, respectively.

(9) COMMITMENTS AND CONTINGENCIES

Substantially all of the Company's revenue and costs for all periods since
December 31, 1995, are subject to audit by agencies of the U.S. Government.
Management does not expect the results of these audits to have a material impact
on the financial position or future results of operations of the Company.

The Company leases equipment and office space under various noncancellable
operating leases. The office leases provide for future rental increases based on
the Company's pro-rata share of increases in building operating expenses and
real estate taxes, and for inflation adjustments based on increases in the
Consumer Price Index. Rent expense, including month-to-month leases, for the
years ended December 31, 1994, 1995, and 1996, totalled $372, $557 and $595,
respectively. Rent expense for the periods ended June 30, 1997, September 30,
1996, and September 30, 1997, were $399, $558 and $653, respectively. Future
minimum lease commitments under non-cancellable operating leases for years
ending June 30, are as follows:

<TABLE>
<CAPTION>
OFFICE/
WAREHOUSE EQUIPMENT TOTAL
--------- --------- ------
<S> <C> <C> <C>
1998..................................................... $ 604 $ 166 $ 770
1999..................................................... 496 88 584
2000..................................................... 492 26 518
2001..................................................... 469 14 483
2002..................................................... 403 -- 403
------ ---- ------
$ 2,464 $ 294 $2,758
====== ==== ======
</TABLE>

F-80
<PAGE> 145

STAR MOUNTAIN, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(10) COMMON STOCK

Common stock consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------- JUNE 30, SEPTEMBER 30,
1995 1996 1997 1997
------------ ------------ ---------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
Par value............................. $ .01 .01 N/A N/A
Shares:
Authorized.......................... 1,000,000 1,000,000 15,000,000 15,000,000
Issued.............................. 752,679 762,093 8,122,232 8,127,332
</TABLE>

Effective February 14, 1997, the Company's voting common stock was
increased from 800,000 shares of $.01 par value to 12,000,000 shares of no par
value, and the non-voting stock was increased from 200,000 shares of $.01 par
value to 3,000,000 shares of no par value.

(11) STOCK OPTIONS

The Company offers key employees the opportunity to purchase stock through
the Star Mountain Key Person Stock Option Plan (the "Plan"). Under the Plan, the
Company issues options to eligible employees who must have one year of service
with the Company. The exercise price for the options is at or above the current
market price of the Company's shares, as determined by management. Management
has applied a consistent formula which includes gross revenue and net income in
determining the Company's share price. Options are exercisable upon issuance for
periods of 3 to 5 years from the date of the grant.

The activity in the Plan since 1994 is presented below. All options and
option prices have been restated to reflect the 12:1 stock split in February
1997.

<TABLE>
<CAPTION>
NUMBER OF OPTIONS WEIGHTED
OUTSTANDING AND AVERAGE
EXERCISABLE EXERCISE PRICE
----------------- --------------
<S> <C> <C>
Balance, December 31, 1993............................ 828,000 $ 0.26
Granted............................................. 264,000 0.42
Exercised........................................... (127,356) 0.23
Forfeited........................................... (52,644) 0.23
---------
Balance, December 31, 1994............................ 912,000 0.31
Granted............................................. 384,000 0.47
Forfeited........................................... (360,000) 0.21
---------
Balance, December 31, 1995............................ 936,000 0.42
Granted............................................. 936,000 0.49
Forfeited........................................... (348,000) 0.46
---------
Balance, December 31, 1996............................ 1,524,000 0.45
Granted............................................. 123,000 1.00
Exercised........................................... (73,200) 0.24
Forfeited........................................... (120,000) 0.49
---------
Balance, June 30, 1997................................ 1,453,800 0.50
Granted............................................. 60,000 1.00
---------
Balance, September 30, 1997........................... 1,513,800 0.52
=========
</TABLE>

F-81
<PAGE> 146

STAR MOUNTAIN, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The weighted average price for options outstanding and exercisable at June
30, 1997, was $.50 and at September 30, 1997, was $.52. The weighted average
remaining term of the outstanding options is 3.2 years.

In October 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based
Compensation". SFAS No. 123 defines a "fair value based method" of accounting
for an employee stock option. Under this method, compensation cost is measured
at the grant date based on the value of the award and is recognized over the
service period. The Company has historically accounted for employee stock
options under the "intrinsic value method" as defined by APB Opinion No. 25,
"Accounting for Stock Issued to Employees". Under the intrinsic value method,
compensation cost is the excess, if any, of the quoted market price of the stock
at grant date over the amount an employee must pay to acquire the stock. The
Company's Plan, accounted for under APB Opinion No. 25, does not result in any
compensation cost.

SFAS No. 123 allows an entity to continue to use the intrinsic value method
and management has elected to do so. However, entities electing to remain on the
intrinsic value method must make pro forma disclosures of net income, as if the
fair value based method of accounting had been applied. Because the method of
accounting in SFAS No. 123 has not been applied to options granted prior to
January 1, 1994, the resulting pro forma compensation costs may not be
representative of the cost to be expected in future years.

Under SFAS No. 123, net income would have been as follows:

<TABLE>
<CAPTION>
SEPTEMBER
DECEMBER 31, 30,
-------------------- JUNE 30, ------------
1994 1995 1996 1997 1996 1997
---- ---- ---- -------- ---- ----
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net income, as reported................... $214 $992 $604 $211 $606 $557
Pro forma net income...................... $211 $984 $586 $200 $593 $539
</TABLE>

The fair value of each option is estimated on the date of grant using the
following assumptions: no dividend yield, no volatility, risk-free interest
rates approximating 6% and expected lives of 3 to 5 years. The weighted average
grant date fair value of the options was as follows:

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31, DECEMBER 31, JUNE 30, SEPTEMBER 30, SEPTEMBER 30,
1994 1995 1996 1997 1996 1997
------------ ------------ ------------ -------- ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Weighted
average fair
value........ $.11 $.11 $.13 $.16 $ .13 $ .16
</TABLE>

(12) INCOME TAXES

Income tax expense consists of the following amounts:

<TABLE>
<CAPTION>
SEPTEMBER 30,
DECEMBER 31, JUNE 30, -------------
1996 1997 1996 1997
------------ -------- ---- ----
(UNAUDITED)
<S> <C> <C> <C> <C>
Current:
Federal...................................... $313 $139 $302 $322
State........................................ 84 30 58 53
Deferred:
Federal...................................... -- (41) -- (41)
State........................................ -- (3) -- (3)
---- ---- ---- ----
$397 $125 $360 $331
==== ==== ==== ====
</TABLE>

F-82
<PAGE> 147

STAR MOUNTAIN, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The differences between the effective income tax rate and the statutory
federal income tax rates are as follows:

<TABLE>
<CAPTION>
SEPTEMBER 30,
DECEMBER 31, JUNE 30, -------------------------------
1996 1997 1996 1997
------------ -------- ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C>
Computed "expected" tax on
income........................... 34.0% 34.0% 34.0% 34.0%
State taxes, net of federal
benefit.......................... 4.1 4.1 4.1 4.1
Other, net.................... 1.6 (0.9) (0.8) (0.8)
---- ---- ---- ----
Taxes on income.................... 39.7% 37.2% 37.3% 37.3%
==== ==== ==== ====
</TABLE>

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and liabilities are presented below:

<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30, SEPTEMBER 30,
1996 1997 1997
------------ -------- -------------
(UNAUDITED)
<S> <C> <C> <C>
Deferred tax assets result from
accrued employee benefits,
principally vacation........................... $ 29 $ 42 $ 42
==== ==== ====
Deferred tax liabilities result from:
Differences in depreciation methods............ $ 29 $ 27 $ 27
Change in accounting method from cash to
accrual for ORA............................. -- 99 99
---- ---- ----
$ 29 $126 $ 126
==== ==== ====
</TABLE>

(13) SUBSEQUENT EVENT (UNAUDITED)

On October 1, 1997, the Company acquired the net assets of the Systems
Effectiveness Division (SED) of Essex Corporation for a total price of $1,475.
The net assets represent substantially all of the operating assets of the
division. The excess of the purchase price over the book value of the tangible
assets acquired of approximately $930 has been recorded as goodwill.

The following table sets forth the pro forma information assuming that all
acquisitions had occurred on January 1, 1995 (the earliest date information is
available). The pro forma information takes into account amortization of
goodwill and additional interest costs, net of tax benefits.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, SIX MONTHS
----------------------------- ENDED
1995 1996 JUNE 30, 1997
------------ ------------ -------------
<S> <C> <C> <C>
Gross revenue................................ $ 22,668 $ 24,818 $14,520
Operating income............................. 1,081 1,524 1,087
Net income................................... 723 529 121
</TABLE>

In November 1997, the Company entered into a definitive merger agreement
with Provant, Inc. ("Provant") and one of its subsidiaries, whereby Provant will
acquire the Company upon completion of the proposed initial public offering.

F-83
<PAGE> 148

======================================================

No dealer, sales representative or any other person has been authorized to
give any information or to make any representations in connection with the
Offering other than those contained in this Prospectus, and, if given or made,
such information or representations must not be relied upon as having been
authorized by the Company or the Underwriters. This Prospectus does not
constitute an offer to sell or a solicitation of any offer to buy any securities
other than the shares of Common Stock to which it relates or an offer to, or a
solicitation of, any person in any jurisdiction where such an offer or
solicitation would be unlawful. Neither the delivery of this Prospectus nor any
sale made hereunder shall, under any circumstances, create any implication that
there has been no change in the affairs of the Company or that information
contained herein is correct as of any time subsequent to the date hereof.
----------------------------
TABLE OF CONTENTS
----------------------------

<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary....................... 3
Risk Factors............................. 9
Combination.............................. 15
Use of Proceeds.......................... 18
Dividend Policy.......................... 18
Capitalization........................... 19
Dilution................................. 20
Selected Financial Data.................. 21
Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................. 23
Business................................. 37
Management............................... 47
Principal Stockholders................... 53
Certain Transactions..................... 54
Description of Capital Stock............. 58
Shares Eligible for Future Sale.......... 59
Underwriting............................. 61
Legal Matters............................ 62
Experts.................................. 62
Additional Information................... 63
Index to Financial Statements............ F-1
</TABLE>

Until , 1998 (25 days after the date of this Prospectus), all
dealers effecting transactions in the registered securities offered hereby,
whether or not participating in this distribution, may be required to deliver a
Prospectus. This is in addition to the obligation of dealers to deliver a
Prospectus when acting as Underwriters and with respect to their unsold
allotments or subscriptions.

======================================================
======================================================
2,600,000 SHARES

PROVANT, INC.

COMMON STOCK

------------------------
PROSPECTUS
------------------------

NationsBanc Montgomery

Securities LLC

Salomon Smith Barney

Piper Jaffray Inc.

, 1998

======================================================
<PAGE> 149

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the various expenses in connection with the
sale and distribution of the securities being registered, other than
underwriting discounts and commissions. All of the amounts shown are estimated
except the Securities and Exchange Commission registration fee and the NASD
filing fee.

<TABLE>
<S> <C>
SEC registration fee..................................................... $ 11,467
NASD filing fee.......................................................... 4,387
Blue Sky fees and expenses............................................... 1,500
New York Stock Exchange listing fee...................................... 100,000
Printing and engraving expenses.......................................... 275,000
Legal fees and expenses.................................................. 950,000
Accounting fees and expenses............................................. 900,000
Transfer agent and registrar fees........................................ 5,000
Premium for directors' and officers' insurance........................... 100,000
Miscellaneous............................................................ 402,646
----------
Total.......................................................... $2,750,000
==========
</TABLE>

To the extent the foregoing fees and expenses are incurred prior to the
Closing, certain of the Company's executive officers will advance to the Company
the funds required to pay such fees and expenses, and the Company will reimburse
those individuals for such fees and expenses out of the proceeds of the
Offering.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Company is a Delaware corporation. Reference is made to Section 145 of
the DGCL, as amended, which provides that a corporation may indemnify any person
who was or is a party to or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation) by reason of the fact that he or she is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him or her in connection with such action,
suit or proceeding if he or she acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests of the
corporation and, with respect to any criminal action or proceedings, had no
reasonable cause to believe his or her conduct was unlawful. Section 145 further
provides that a corporation similarly may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he or she is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees) actually and reasonably incurred by him or
her in connection with the defense or settlement of such action or suit if he or
she acted in good faith and in a manner he or she reasonably believed to be in
or not opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Delaware Court of Chancery or the court
in which such action or suit was brought shall determine upon application that,
despite an adjudication of liability, but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem proper. The
Company's Certificate of Incorporation further provides that the Company shall
indemnify its directors and officers to the full extent permitted by the law of
the State of Delaware.

II-1
<PAGE> 150

The Company's Certificate of Incorporation provides that the Company's
directors shall not be liable to the Company or its stockholders for monetary
damages for breach of fiduciary duty as a director, except to the extent that
exculpation from liability is not permitted under the DGCL as in effect at the
time such liability is determined.

The Certificate of Incorporation and By-laws also provide that each person
who was or is made a party to, or is involved in, any action, suit, proceeding
or claim by reason of the fact that he or she is or was a director or officer of
the Registrant (or is or was serving at the request of the Registrant as a
director or officer of any other enterprise including service with respect to
employee benefit plans) shall be indemnified and held harmless by the
Registrant, to the full extent permitted by Delaware law, as in effect from time
to time, against all expenses (including attorneys' fees and expenses),
judgments, fines, penalties and amounts to be paid in settlement incurred by
such person in connection with the investigation, preparation to defend or
defense of such action, suit, proceeding or claim. The Company's By-laws allow
for similar rights of indemnification to be afforded, in the Company's
discretion, to its employees and agents.

The rights to indemnification and the payment of expenses provided by the
Certificate of Incorporation and By-laws do not apply to any action, suit,
proceeding or claim initiated by or on behalf of a person otherwise entitled to
the benefit of such provisions. Any person seeking indemnification under the
Certificate of Incorporation shall be deemed to have met the standard of conduct
required for such indemnification unless the contrary shall be established. Any
repeal or modification of such indemnification provisions shall not adversely
affect any right or protection of a director or officer with respect to any
conduct of such director or officer occurring prior to such repeal or
modification.

The Company maintains an indemnification insurance policy covering all
directors and officers of the Company and its subsidiaries.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

In December 1996, the Company issued (i) 298.8, 762 and 762.1 shares of
Common Stock, respectively, at a purchase price of $1.00 per share, to the
Company's initial stockholders and (ii) 169.4 shares of Common Stock at a
purchase price of $1.00 per share to a consultant. In July 1997, the Company
issued 80.5, 260.4 and 351.6 shares of Common Stock, respectively, at a purchase
price of $1.00 per share, to additional consultants. In September 1997, the
Company issued (i) 134.2 and 201.4 shares of Common Stock, respectively, at a
purchase price of $1.00 per share, to two of the Company's initial stockholders
and (ii) 67.1, 100.7 and 201.4 shares of Common Stock, respectively, at a
purchase price of $1.00 per share, to consultants. In November 1997, the Company
issued 27.3 shares and one share of Common Stock, respectively, at a purchase
price of $1.00 per share, to two consultants.

In September 1997, the Company issued to a consultant an option to purchase
10,000 shares of Common Stock of the Company at a purchase price of $5.00 per
share, exercisable immediately upon the Closing. The option shall terminate
three years following the Closing.

As partial consideration for an agreement to extend financing to the
Company in connection with the Offering and the Combination, on October 6, 1997,
the Company issued two warrants to each of Paul M. Verrochi and Dominic J.
Puopolo. The first warrant entitles the holder to purchase (i) 68 shares of
Common Stock at $1.00 per share prior to the Offering or (ii) following the
Offering 2.0% of the Common Stock outstanding immediately prior to the Offering
(but giving effect to the Combination) at a per share exercise price equal to
the initial public offering price. The second warrant entitles the holder
following the Offering to purchase 2.5% of the Common Stock immediately prior to
the Offering (but giving effect to the Combination). The second warrant will be
exercisable only if the market price of the Common Stock increases to certain
threshold levels, or earlier under certain circumstances involving the merger or
sale of the Company.

All such issuances of Common Stock have been made in reliance upon the
exemption from registration afforded by Section 4(2) under the Securities Act.

II-2
<PAGE> 151

The foregoing amounts (except with respect to the option granted in
September 1997) have not been adjusted for the stock dividend that will be
declared by the Board of Directors of Provant prior to the consummation of the
Offering.

ITEM 16. EXHIBITS

<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
- ------- --------------------------------------------------------------------------- ----------
<C> <S> <C>
+1 Form of Underwriting Agreement.............................................
*2.1 Agreement and Plan of Merger by and among Provant, Inc., Behavioral
Acquisition Corp., Paul M. Verrochi, Dominic J. Puopolo, Behavioral
Technology, Inc. and Paul C. Green, Ph.D. .................................
*2.2 Agreement and Plan of Merger by and among Provant, Inc., Decker Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, Decker Communications, Inc.,
Bert Decker and Kenneth Taylor.............................................
*2.3 Agreement and Plan of Merger by and among Provant, Inc., Howard Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, J. Howard & Associates, Inc.,
Jeffrey P. Howard and Marc S. Wallace......................................
*2.4 Agreement and Plan of Merger by and among Provant, Inc., LSS Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, Robert Steinmetz, Ph.D., and
Associates, Inc., Edwin Bauch as Trustee of the Steinmetz Children's Trust
u/d/t dated December 31, 1996, Edwin Bauch as Trustee of the King
Children's Trust u/d/t dated December 31, 1996, John F. King and Robert A.
Steinmetz, Ph.D. ..........................................................
*2.5 Agreement and Plan of Merger by and among Provant, Inc., MOHR Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, MOHR Retail Learning Systems,
Inc., Herbert Cohen, Judith Cohen and Michael Patrick......................
*2.6 Agreement and Plan of Merger by and among Provant, Inc., Paul M. Verrochi,
Dominic J. Puopolo, Star Mountain, Inc., Star Acquisition Corp. and Carl
von Sternberg..............................................................
*2.7 Agreement and Plan of Merger by and among Provant, Inc., Novations
Acquisition Corp., Paul M. Verrochi, Dominic J. Puopolo, Novations Group,
Inc., Joseph Folkman, Joseph Hanson, Kurt Sandholtz, Norman Smallwood,
Randy Stott and Jonathan Younger...........................................
*3.1 Certificate of Incorporation of the Company................................
*3.2 By-laws of the Company.....................................................
*4.1 Form of Specimen Stock Certificate.........................................
*5 Opinion of Nutter, McClennen & Fish, LLP...................................
*10.1 1998 Equity Incentive Plan.................................................
*10.2 Stock Plan for Non-Employee Directors......................................
*10.3 1998 Employee Stock Purchase Plan..........................................
*10.4 Form of Warrants to Messrs. Verrochi and Puopolo...........................
*10.5 Form of Contingent Warrants to Messrs. Verrochi and Puopolo................
*10.6 Form of Employment Agreement between Rajiv Bhatt and Provant, Inc. ........
*10.7 Form of Employment Agreement between MOHR Acquisition Corp., Herbert A.
Cohen, and Provant, Inc. ..................................................
*10.8 Form of Employment Agreement between Decker Acquisition Corp., Bert Decker,
and Provant, Inc. .........................................................
*10.9 Form of Employment Agreement between Philip Gardner and Provant, Inc. .....
*10.10 Form of Employment Agreement between Behavioral Acquisition Corp., Paul C.
Green, and Provant, Inc. ..................................................
*10.11 Form of Employment Agreement between Novations Acquisition Corp., Joe
Hanson, and Provant, Inc. .................................................
*10.12 Form of Employment Agreement between LSS Acquisition Corp., John F. King,
and Provant, Inc. .........................................................
</TABLE>

II-3
<PAGE> 152

<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
- ------- --------------------------------------------------------------------------- ----------
<C> <S> <C>
*10.13 Form of Employment Agreement between Dominic J. Puopolo and Provant,
Inc. ......................................................................
*10.14 Form of Employment Agreement between A. Carl von Sternberg and Provant,
Inc. ......................................................................
*10.15 Form of Employment Agreement between Paul M. Verrochi and Provant, Inc. ...
*10.16 Form of Employment Agreement between Howard Acquisition Corp., Marc S.
Wallace, and Provant, Inc. ................................................
*10.17 Form of Employment Agreement between John H. Zenger and Provant, Inc. .....
*10.18 Form of Consulting Agreement between Michael J. Davies and Provant, Inc....
*10.19 Lease Agreement between Behavioral Technology, Inc. and Paul C. Green,
Ph.D.......................................................................
*10.20 Lease Agreement between Novations Group, Inc. and Novations Partners,
L.L.C. ....................................................................
*10.21 Promissory note of A. Carl von Sternberg...................................
*10.22 Form of Consulting Agreement between Donald W. Glazer and Provant, Inc.....
+21 Subsidiaries of the Registrant.............................................
+23.1 Consent of KPMG Peat Marwick LLP...........................................
+23.2 Consent of Friedman & Fuller, P.C..........................................
*23.3 Consent of Nutter, McClennen & Fish, LLP (contained in Exhibit 5)..........
+24 Power of Attorney (contained in the signature page to this Registration
Statement).................................................................
+27 Financial Data Schedule....................................................
+99.1 Consent of Rajiv Bhatt.....................................................
+99.2 Consent of Herbert A. Cohen................................................
+99.3 Consent of Michael J. Davies...............................................
+99.4 Consent of Bert Decker.....................................................
+99.5 Consent of Philip Gardner..................................................
+99.6 Consent of Paul C. Green...................................................
+99.7 Consent of Joe Hanson......................................................
+99.8 Consent of John F. King....................................................
+99.9 Consent of Dominic J. Puopolo..............................................
+99.10 Consent of A. Carl von Sternberg...........................................
+99.11 Consent of Paul M. Verrochi................................................
+99.12 Consent of Marc S. Wallace.................................................
+99.13 Consent of John H. Zenger..................................................
</TABLE>

- ---------------
* To be filed by amendment.

+ Filed herewith.

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing specified in the Underwriting Agreement certificates in such
denominations and registered in such names as required by the Underwriters to
permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnifica-

II-4
<PAGE> 153

tion by it is against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon Rule 430A under the
Securities Act and contained in a form of prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities
Act shall be deemed to be part of this Registration Statement as of the
time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new Registration Statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.

II-5
<PAGE> 154

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Boston, the
Commonwealth of Massachusetts, on the 12th day of February 1998.

PROVANT, INC.

By: /s/ PAUL M. VERROCHI
------------------------------------
Paul M. Verrochi
President

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below on this Registration Statement hereby constitutes and appoints
Paul M. Verrochi, Dominic J. Puopolo, Constantine Alexander and James E. Dawson,
and each of them, with full power to act without the other, his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities (until
revoked in writing) to sign any and all amendments (including post-effective
amendments and amendments thereto) to this Registration Statement on Form S-1 of
the registrant, and to file the same, with all exhibits thereto and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and
necessary fully to all intents and purposes as he might or could do in person
thereby ratifying and confirming all that said attorneys-in-fact and agents or
any of them, or their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED,
THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------------ ------------------------------- ------------------
<C> <S> <C>

/s/ PAUL M. VERROCHI Chief Executive Officer and February 12, 1998
- ------------------------------------------ Director
Paul M. Verrochi

/s/ DOMINIC J. PUOPOLO Chief Financial Officer and February 12, 1998
- ------------------------------------------ Director
Dominic J. Puopolo

/s/ RAJIV BHATT Chief Accounting Officer February 12, 1998
- ------------------------------------------
Rajiv Bhatt
</TABLE>

II-6
<PAGE> 155

EXHIBIT INDEX

<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
- ------- --------------------------------------------------------------------------- ----------
<C> <S> <C>
+1 Form of Underwriting Agreement.............................................
*2.1 Agreement and Plan of Merger by and among Provant, Inc., Behavioral
Acquisition Corp., Paul M. Verrochi, Dominic J. Puopolo, Behavioral
Technology, Inc. and Paul C. Green, Ph.D. .................................
*2.2 Agreement and Plan of Merger by and among Provant, Inc., Decker Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, Decker Communications, Inc.,
Bert Decker and Kenneth Taylor.............................................
*2.3 Agreement and Plan of Merger by and among Provant, Inc., Howard Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, J. Howard & Associates, Inc.,
Jeffrey P. Howard and Marc S. Wallace......................................
*2.4 Agreement and Plan of Merger by and among Provant, Inc., LSS Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, Robert Steinmetz, Ph.D., and
Associates, Inc., Edwin Bauch as Trustee of the Steinmetz Children's Trust
u/d/t dated December 31, 1996, Edwin Bauch as Trustee of the King
Children's Trust u/d/t dated December 31, 1996, John F. King and Robert A.
Steinmetz, Ph.D. ..........................................................
*2.5 Agreement and Plan of Merger by and among Provant, Inc., MOHR Acquisition
Corp., Paul M. Verrochi, Dominic J. Puopolo, MOHR Retail Learning Systems,
Inc., Herbert Cohen, Judith Cohen and Michael Patrick......................
*2.6 Agreement and Plan of Merger by and among Provant, Inc., Paul M. Verrochi,
Dominic J. Puopolo, Star Mountain, Inc., Star Acquisitions Corp. and Carl
von Sternberg..............................................................
*2.7 Agreement and Plan of Merger by and among Provant, Inc., Novations
Acquisition Corp., Paul M. Verrochi, Dominic J. Puopolo, Novations Group,
Inc., Joseph Folkman, Joseph Hanson, Kurt Sandholtz, Norman Smallwood,
Randy Stott and Jonathan Younger...........................................
*3.1 Certificate of Incorporation of the Company................................
*3.2 By-laws of the Company.....................................................
*4.1 Form of Specimen Stock Certificate.........................................
*5 Opinion of Nutter, McClennen & Fish, LLP...................................
*10.1 1998 Equity Incentive Plan.................................................
*10.2 Stock Plan for Non-Employee Directors......................................
*10.3 1998 Employee Stock Purchase Plan..........................................
*10.4 Form of Warrants to Messrs. Verrochi and Puopolo...........................
*10.5 Form of Contingent Warrants to Messrs. Verrochi and Puopolo................
*10.6 Form of Employment Agreement between Rajiv Bhatt and Provant, Inc. ........
*10.7 Form of Employment Agreement between MOHR Acquisition Corp., Herbert A.
Cohen, and Provant, Inc. ..................................................
*10.8 Form of Employment Agreement between Decker Acquisition Corp., Bert Decker,
and Provant, Inc. .........................................................
*10.9 Form of Employment Agreement between Philip Gardner and Provant, Inc. .....
*10.10 Form of Employment Agreement between Behavioral Acquisition Corp., Paul C.
Green, and Provant, Inc. ..................................................
*10.11 Form of Employment Agreement between Novations Acquisition Corp., Joe
Hanson, and Provant, Inc. .................................................
*10.12 Form of Employment Agreement between LSS Acquisition Corp., John F. King,
and Provant, Inc. .........................................................
*10.13 Form of Employment Agreement between Dominic J. Puopolo and Provant,
Inc. ......................................................................
*10.14 Form of Employment Agreement between A. Carl von Sternberg and Provant,
Inc. ......................................................................
*10.15 Form of Employment Agreement between Paul M. Verrochi and Provant, Inc. ...
</TABLE>
<PAGE> 156

<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT DESCRIPTION PAGE NO.
- ------- --------------------------------------------------------------------------- ----------
<C> <S> <C>
*10.16 Form of Employment Agreement between Howard Acquisition Corp., Marc S.
Wallace, and Provant, Inc. ................................................
*10.17 Form of Employment Agreement between John H. Zenger and Provant, Inc. .....
*10.18 Form of Consulting Agreement between Michael J. Davies and Provant, Inc....
*10.19 Lease Agreement between Behavioral Technology, Inc. and Paul C. Green,
Ph.D.......................................................................
*10.20 Lease Agreement between Novations Group, Inc. and Novations Partners,
L.L.C. ....................................................................
*10.21 Promissory note of A. Carl von Sternberg...................................
*10.22 Form of Consulting Agreement between Donald W. Glazer and Provant, Inc.....
+21 Subsidiaries of the Registrant.............................................
+23.1 Consent of KPMG Peat Marwick LLP...........................................
+23.2 Consent of Friedman & Fuller, P.C..........................................
*23.3 Consent of Nutter, McClennen & Fish, LLP (contained in Exhibit 5)..........
+24 Power of Attorney (contained in the signature page to this Registration
Statement).................................................................
+27 Financial Data Schedule....................................................
+99.1 Consent of Rajiv Bhatt.....................................................
+99.2 Consent of Herbert A. Cohen................................................
+99.3 Consent of Michael J. Davies...............................................
+99.4 Consent of Bert Decker.....................................................
+99.5 Consent of Philip Gardner..................................................
+99.6 Consent of Paul C. Green...................................................
+99.7 Consent of Joe Hanson......................................................
+99.8 Consent of John F. King....................................................
+99.9 Consent of Dominic J. Puopolo..............................................
+99.10 Consent of A. Carl von Sternberg...........................................
+99.11 Consent of Paul M. Verrochi................................................
+99.12 Consent of Marc S. Wallace.................................................
+99.13 Consent of John H. Zenger..................................................
</TABLE>

- ---------------
* To be filed by amendment.

+ Filed herewith.

<PAGE> 1
--------------

PROVANT, INC.

COMMON STOCK

UNDERWRITING AGREEMENT

DATED , 1998

<PAGE> 2
TABLE OF CONTENTS

<TABLE>
<S> <C>
Section 1. Representations and Warranties of the Company................................. 2
Compliance with Registration Requirements................................................................ 2
Offering Materials Furnished to Underwriters............................................................. 3
Distribution of Offering Material By the Company......................................................... 3
The Underwriting Agreement............................................................................... 3
Authorization of the Common Shares....................................................................... 3
No Applicable Registration or Other Similar Rights....................................................... 3
No Material Adverse Change............................................................................... 3
Independent Accountants.................................................................................. 4
Preparation of the Financial Statements.................................................................. 4
Incorporation and Good Standing of the Company, its Subsidiaries and the Founding
Companies....................................................................................... 5
Capitalization and Other Capital Stock Matters.......................................................... 6
Stock Exchange Listing................................................................................... 6
Non-Contravention of Existing Instruments; No Further Authorizations or Approvals
Required........................................................................................ 6
No Material Actions or Proceedings....................................................................... 7
Intellectual Property Rights............................................................................. 7
All Necessary Permits, etc............................................................................... 7
Title to Properties...................................................................................... 8
Tax Law Compliance....................................................................................... 8
Company Not an "Investment Company"...................................................................... 8
Insurance................................................................................................ 8
No Price Stabilization or Manipulation................................................................... 9
Related Party Transactions............................................................................... 9
No Unlawful Contributions or Other Payments.............................................................. 9
Accounting Systems....................................................................................... 9
Compliance with Environmental Laws....................................................................... 9
ERISA Compliance........................................................................................ 10
Combination Agreements.................................................................................. 11
Representations in Combination Agreements............................................................... 11

Section 2. Purchase, Sale and Delivery of the Common Shares............................. 11
The Firm Common Shares.................................................................................. 11
The First Closing Date.................................................................................. 11
The Optional Common Shares; the Second Closing Date..................................................... 12
Public Offering of the Common Shares.................................................................... 12
Payment for the Common Shares........................................................................... 12
Delivery of the Common Shares........................................................................... 13
Delivery of Prospectus to the Underwriters.............................................................. 13
</TABLE>
-i-

<PAGE> 3

<TABLE>
<S> <C>
Section 3. Additional Covenants of the Company.......................................... 13
Representatives' Review of Proposed Amendments and Supplements.......................................... 13
Securities Act Compliance............................................................................... 13
Amendments and Supplements to the Prospectus and Other Securities Act Matters........................... 14
Copies of any Amendments and Supplements to the Prospectus.............................................. 14
Blue Sky Compliance..................................................................................... 14
Use of Proceeds......................................................................................... 15
Transfer Agent.......................................................................................... 15
Earnings Statement...................................................................................... 15
Periodic Reporting Obligations.......................................................................... 15
Agreement Not To Offer or Sell Additional Securities.................................................... 15
Future Reports to the Representatives................................................................... 15
Satisfaction of Founding Company Combination Conditions................................................. 16

Section 4. Payment of Expenses.......................................................... 16

Section 5. Conditions of the Obligations of the Underwriters............................ 17
Accountants' Comfort Letter............................................................................. 17
Compliance with Registration Requirements; No Stop Order; No Objection from NASD........................ 17
No Material Adverse Change or Ratings Agency Change..................................................... 18
Opinion of Counsel for the Company...................................................................... 18
Opinion of Counsel for the Underwriters................................................................. 18
Officers' Certificate................................................................................... 18
Bring-down Comfort Letter............................................................................... 19
Combination Closings.................................................................................... 19
Combination Agreements.................................................................................. 19
Lock-Up Agreement from Certain Stockholders of the Company.............................................. 20
Additional Documents.................................................................................... 20

Section 6. Reimbursement of Underwriters' Expenses...................................... 20

Section 7. Effectiveness of this Agreement.............................................. 21

Section 8. Indemnification.............................................................. 21
Indemnification of the Underwriters by the Company...................................................... 21
Indemnification of the Underwriters by the Founders..................................................... 22
Indemnification of the Company, its Directors and Officers.............................................. 23
Notifications and Other Indemnification Procedures...................................................... 23
Settlements............................................................................................. 24

Section 9. Contribution................................................................. 25

Section 10. Default of One or More of the Several Underwriters........................... 26
</TABLE>

-ii-

<PAGE> 4

<TABLE>
<S> <C> <C>
Section 11. Termination of this Agreement................................................ 27

Section 12. Representations and Indemnities to Survive Delivery.......................... 27

Section 13. Notices...................................................................... 28

Section 14. Successors................................................................... 28

Section 15. Partial Unenforceability..................................................... 28

Section 16. Governing Law Provisions..................................................... 29

Section 17. General Provisions........................................................... 29
</TABLE>

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<PAGE> 5
UNDERWRITING AGREEMENT

, 1998

NATIONSBANC MONTGOMERY SECURITIES, LLC
SALOMON SMITH BARNEY INC.
PIPER JAFFRAY INC.
As Representatives of the several Underwriters
c/o NATIONSBANC MONTGOMERY SECURITIES, INC.
600 Montgomery Street
San Francisco, California 94111

Ladies and Gentlemen:

INTRODUCTORY. Provant, Inc., a Delaware corporation (the
"Company"), proposes to issue and sell to the several underwriters named in
Schedule A (the "Underwriters") an aggregate of __________ shares (the "Firm
Common Shares") of its Common Stock, par value $.01 per share (the "Common
Stock"). In addition, the Company has granted to the Underwriters an option to
purchase up to an additional __________ shares (the "Optional Common Shares") of
Common Stock, as provided in Section 2. The Firm Common Shares and, if and to
the extent such option is exercised, the Optional Common Shares are collectively
called the "Common Shares." NationsBanc Montgomery Securities, Inc. ("NMS"),
Salomon Smith Barney Inc. and Piper Jaffray Inc. have agreed to act as
representatives of the several Underwriters (in such capacity, the
"Representatives") in connection with the offering and sale of the Common
Shares.

The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-1
(File No. 333- ), which contains a form of prospectus to be used in connection
with the public offering and sale of the Common Shares. Such registration
statement, as amended, including the financial statements, exhibits and
schedules thereto, in the form in which it was declared effective by the
Commission under the Securities Act of 1933 and the rules and regulations
promulgated thereunder (collectively, the "Securities Act"), including any
information deemed to be a part thereof at the time of effectiveness pursuant to
Rule 430A or Rule 434 under the Securities Act, is called the "Registration
Statement." Any registration statement filed by the Company pursuant to Rule
462(b) under the Securities Act is called the "Rule 462(b) Registration
Statement," and from and after the date and time of filing of the Rule 462(b)
Registration Statement the term "Registration Statement" shall include the Rule
462(b) Registration Statement. Such prospectus, in the form first used by the
Underwriters to confirm sales of the Common Shares, is called the "Prospectus;"
provided, however, if the Company has, with the consent of NMS, elected to rely
upon Rule 434 under the Securities Act, the term "Prospectus" shall

<PAGE> 6
mean the Company's prospectus subject to completion (each, a "preliminary
prospectus") dated , 1998 (such preliminary prospectus is called the "Rule
434 preliminary prospectus"), together with the applicable term sheet (the "Term
Sheet") prepared and filed by the Company with the Commission under Rules 434
and 424(b) under the Securities Act and all references in this Agreement to the
date of the Prospectus shall mean the date of the Term Sheet. All references in
this Agreement to the Registration Statement, the Rule 462(b) Registration
Statement, a preliminary prospectus, the Prospectus or the Term Sheet, or any
amendments or supplements to any of the foregoing, shall include any copy
thereof filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval System ("EDGAR").

Simultaneously with the closing of the purchase of the Firm
Common Shares by the Underwriters, the Company will acquire in separate
combination transactions (the "Combinations") all of the Common Stock and
ownership interests of the Founding Companies (as hereinafter defined)
(collectively, the "Founding Company Combinations"), the consideration for which
will be a combination of cash and shares of Common Stock as described in the
Registration Statement.

The Company hereby confirms its agreements with the
Underwriters as follows:

SECTION 1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company hereby represents, warrants and covenants to each
Underwriter as follows:

(a) Compliance with Registration Requirements. The
Registration Statement and any Rule 462(b) Registration Statement have been
declared effective by the Commission under the Securities Act. The Company has
complied to the Commission's satisfaction with all requests of the Commission
for additional or supplemental information. No stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement is in effect and no proceedings for such purpose have been instituted
or are pending or, to the best knowledge of the Company, are contemplated or
threatened by the Commission.

Each preliminary prospectus and the Prospectus when filed
complied in all material respects with the Securities Act and, if filed by
electronic transmission pursuant to EDGAR (except as may be permitted by
Regulation S-T under the Securities Act), was identical to the copy thereof
delivered to the Underwriters for use in connection with the offer and sale of
the Common Shares. Each of the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendment thereto, at the time it
became effective and at all subsequent times, complied and will comply in all
material respects with the Securities Act and did not and will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading.
The Prospectus, as amended or supplemented, as of its date and at all subsequent
times, did not and will not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
The representations and warranties set forth in the two immediately preceding
sentences do not apply to statements in or omissions from

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<PAGE> 7
the Registration Statement, any Rule 462(b) Registration Statement, or any
post-effective amendment thereto, or the Prospectus, or any amendments or
supplements thereto, made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by the
Representatives expressly for use therein. There are no contracts or other
documents required to be described in the Prospectus or to be filed as exhibits
to the Registration Statement which have not been described or filed as
required.

(b) Offering Materials Furnished to Underwriters. The Company
has delivered to the Representatives three complete manually signed copies of
the Registration Statement and of each consent and certificate of experts filed
as a part thereof, and conformed copies of the Registration Statement (without
exhibits) and preliminary prospectuses and the Prospectus, as amended or
supplemented, in such quantities and at such places as the Representatives have
reasonably requested for each of the Underwriters.

(c) Distribution of Offering Material By the Company. The
Company has not distributed and will not distribute, prior to the later of the
Second Closing Date (as defined below) and the completion of the Underwriters'
distribution of the Common Shares, any offering material in connection with the
offering and sale of the Common Shares other than a preliminary prospectus, the
Prospectus or the Registration Statement.

(d) The Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding agreement of,
the Company, enforceable in accordance with its terms, except as rights to
indemnification hereunder may be limited by applicable law and except as the
enforcement hereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles.

(e) Authorization of the Common Shares. The Common Shares to
be purchased by the Underwriters from the Company have been duly authorized for
issuance and sale pursuant to this Agreement and, when issued and delivered by
the Company pursuant to this Agreement, will be validly issued, fully paid and
nonassessable.

(f) No Applicable Registration or Other Similar Rights. There
are no persons with registration or other similar rights to have any equity or
debt securities registered for sale under the Registration Statement or included
in the offering contemplated by this Agreement, except for such rights as have
been duly waived.

(g) No Material Adverse Change. Except as otherwise disclosed
in the Prospectus, subsequent to the respective dates as of which information is
given in the Prospectus: (i) there has been no change, or any development that
could reasonably be expected to result in a change, in the Company, any of its
subsidiaries or any of Behavioral Technologies, Inc., Decker Communications,
Inc., J. Howard and Associates, Inc., Learning Systems Sciences, Inc., MOHR
Retail Learning Systems, Inc., Novations Group, Inc. and Star Mountain, Inc.
(collectively, the "Founding Companies"), which change or development has had,
or could reasonably be expected

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<PAGE> 8
to result in, a material adverse effect on the condition, financial or
otherwise, or in the earnings, business, operations or prospects, whether or not
arising from transactions in the ordinary course of business, of the Company,
its subsidiaries and the Founding Companies, considered as one entity (any such
change or development is called a "Material Adverse Change"); (ii) neither the
Company, any of its subsidiaries or any of the Founding Companies has incurred
any liability or obligation, indirect, direct or contingent, not in the ordinary
course of business or entered into any transaction or agreement not in the
ordinary course of business, which in each case would be material to the
Company, its subsidiaries and the Founding Companies, considered as one entity;
(iii) there has been no adverse change with respect to the goodwill and other
intangible assets (collectively, the "Intangible Assets") such that, as of the
date hereof, the Intangible Assets, net of accumulated amortization, do not have
a value at least equal to the value reflected in the combined financial
statements of the Company and the Founding Companies and no part of the
Intangible Assets are required to be written down in conformity with generally
accepted accounting principles applied on a basis consistent with prior periods;
and (iv) except as disclosed in or contemplated by the Registration Statement,
there has been no dividend or distribution of any kind declared, paid or made by
the Company or any Founding Company or, except for dividends paid to the Company
or other subsidiaries, any of its subsidiaries on any class of capital stock or
repurchase or redemption by the Company, any of its subsidiaries or any Founding
Company of any class of capital stock.

(h) Independent Accountants. KPMG Peat Marwick, LLP, who have
expressed their opinion with respect to certain of the financial statements
(which term as used in this Agreement includes the related notes thereto) and
supporting schedules filed with the Commission as a part of the Registration
Statement and included in the Prospectus, are independent public or certified
public accountants with respect to the Company and each of the Founding
Companies on whose financial statements they have issued their reports, as
required by the Securities Act. [Friedman & Fuller, P.C.], who have expressed
their opinion with respect to the financial statements (which term as used in
this Agreement includes the related notes thereto) [and supporting schedules] of
Star Mountain, Inc. filed with the Commission as a part of the Registration
Statement and included in the Prospectus, are independent public or certified
public accountants with respect to Star Mountain, Inc. as required by the
Securities Act.

(i) Preparation of the Financial Statements. The financial
statements of the Company, the separate financial statements of each of the
Founding Companies and the pro forma combined financial statements of the
Company and the Founding Companies, in each case together with related notes and
schedules, filed with the Commission as a part of the Registration Statement and
included in the Prospectus present fairly the financial position, results of
operations and cash flows of the Company, of each of such Founding Companies and
of the Company and the Founding Companies combined, respectively, as of and at
the dates specified and for the periods specified. The supporting schedules
included in the Registration Statement present fairly the information required
to be stated therein. Such financial statements and supporting schedules have
been prepared in conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods involved, except as may be
expressly stated in the related notes thereto, and all adjustments necessary for
a fair presentation of results for such period have been made. No other
financial statements or supporting schedules are required to be included in the
Registration

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<PAGE> 9
Statement. The financial data set forth in the Prospectus under the captions
"Prospectus Summary--Summary Pro Forma Combined Financial Data" and "--Summary
Individual Founding Company Financial Data," "Capitalization" and "Selected
Financial Data" fairly present the information set forth therein on a basis
consistent with that of the audited and pro forma financial statements contained
in the Registration Statement and the books and records of the Company and the
Founding Companies, as applicable. The pro forma combined financial statements
of the Company and the Founding Companies together with the related notes
thereto included under the captions "Prospectus Summary--Summary Pro Forma
Combined Financial Data," "Selected Financial Data," "Provant, Inc. and Founding
Companies Unaudited Pro Forma Combined Financial Statements" and elsewhere in
the Prospectus and in the Registration Statement present fairly the information
contained therein, have been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and have been
properly presented on the pro forma bases described therein, and the assumptions
used in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances referred to
therein.

(j) Incorporation and Good Standing of the Company, its
Subsidiaries and the Founding Companies. Each of the Company, its subsidiaries
and the Founding Companies has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation and has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Prospectus and,
in the case of the Company, to enter into and perform its obligations under this
Agreement. Each of the Company, each subsidiary and each Founding Company is
duly qualified as a foreign corporation to transact business and is in good
standing in each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except for such jurisdictions where the failure to so qualify or to be
in good standing would not, individually or in the aggregate, result in a
Material Adverse Change. All of the issued and outstanding capital stock of each
subsidiary has been duly authorized and validly issued, is fully paid and
nonassessable and is owned by the Company, directly or through subsidiaries,
free and clear of any security interest, mortgage, pledge, lien, encumbrance or
claim. As of the First Closing Date (as hereinafter defined), after giving
effect to the Founding Company Combinations, all of the outstanding shares of
the capital stock of each of the Founding Companies will be owned by the Company
free and clear of any security interest, mortgage, pledge, lien, encumbrance or
claim; and no options, warrants or other rights to purchase, agreements or other
obligations to issue or other rights to convert any obligations into shares of
capital stock or ownership interests in any of the Founding Companies are
outstanding. The Company does not own or control, directly or indirectly, any
corporation, association or other entity other than the subsidiaries listed in
Exhibit 21 to the Registration Statement.

(k) Capitalization and Other Capital Stock Matters. The
authorized, issued and outstanding capital stock of the Company is as set forth
in the Prospectus under the caption "Capitalization" (other than for subsequent
issuances, if any, pursuant to employee benefit plans described in the
Prospectus or upon exercise of outstanding options or warrants described in the
Prospectus). The Common Stock (including the Common Shares) conforms in all
material respects to the description thereof contained in the Prospectus. All of
the issued and outstanding shares of

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<PAGE> 10
Common Stock have been duly authorized and validly issued, are fully paid and
nonassessable and have been issued in compliance with federal and state
securities laws. None of the outstanding shares of Common Stock were issued in
violation of any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase securities of the Company. Upon completion
of the Founding Company Combinations in the manner described in the Registration
Statement, the shares of Common Stock of the Company to be issued in such
Combinations will be duly authorized, validly issued and fully paid and
non-assessable. There are no authorized or outstanding options, warrants,
preemptive rights, rights of first refusal or other rights to purchase, or
equity or debt securities convertible into or exchangeable or exercisable for,
any capital stock of the Company or any of its subsidiaries other than those
accurately described in the Prospectus. The description of the Company's stock
option, stock bonus and other stock plans or arrangements, and the options or
other rights granted thereunder, set forth in the Prospectus accurately and
fairly presents the information required to be shown with respect to such plans,
arrangements, options and rights.

(l) Stock Exchange Listing. The Common Shares have been
approved for listing on the New York Stock Exchange, subject only to official
notice of issuance.

(m) Non-Contravention of Existing Instruments; No Further
Authorizations or Approvals Required. Neither the Company or any of its
subsidiaries nor any of the Founding Companies is in violation of its charter or
by-laws or is in default (or, with the giving of notice or lapse of time, would
be in default) ("Default") under any indenture, mortgage, loan or credit
agreement, note, contract, franchise, lease or other instrument to which the
Company or any of its subsidiaries or any Founding Company is a party or by
which it or any of them may be bound, or to which any of the property or assets
of the Company or any of its subsidiaries or any Founding Company is subject
(each, an "Existing Instrument"), except for such Defaults as would not,
individually or in the aggregate, result in a Material Adverse Change. The
Company's execution, delivery and performance of this Agreement and consummation
of the transactions contemplated hereby and by the Prospectus (i) have been duly
authorized by all necessary corporate action and will not result in any
violation of the provisions of the charter or by-laws of the Company or any
subsidiary or any Founding Company, (ii) will not conflict with or constitute a
breach of, or Default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any of
its subsidiaries or any Founding Company pursuant to, or require the consent of
any other party to, any Existing Instrument, except for such conflicts,
breaches, Defaults, liens, charges or encumbrances as would not, individually or
in the aggregate, result in a Material Adverse Change; and (iii) will not result
in any violation of any law, administrative regulation or administrative or
court decree applicable to the Company or any subsidiary or any Founding
Company. No consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental or regulatory authority or
agency, is required for the Company's execution, delivery and performance of
this Agreement or any Combination Agreement and consummation of the transactions
contemplated hereby or thereby and by the Prospectus, except such as have been
obtained or made by the Company and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and from the
National Association of Securities Dealers, Inc. (the "NASD").

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<PAGE> 11
(n) No Material Actions or Proceedings. Except as disclosed in
the Prospectus, there are no legal or governmental actions, suits or proceedings
pending or, to the best of the Company's knowledge, threatened (i) against or
affecting the Company or any of its subsidiaries or any Founding Company, (ii)
which has as the subject thereof any officer or director of, or property owned
or leased by, the Company or any of its subsidiaries or any Founding Company or
(iii) relating to environmental or discrimination matters, where in any such
case (A) there is a reasonable possibility that such action, suit or proceeding
might be determined adversely to the Company or such subsidiary or such Founding
Company and (B) any such action, suit or proceeding, if so determined adversely,
would reasonably be expected to result in a Material Adverse Change or adversely
affect the consummation of the transactions contemplated by this Agreement. No
material labor dispute with the employees of the Company or any of its
subsidiaries or any Founding Company exists or, to the best of the Company's
knowledge, is threatened or imminent.

(o) Intellectual Property Rights. The Company, its
subsidiaries and the Founding Companies own or possess sufficient trademarks,
trade names, patent rights, copyrights, licenses, approvals, trade secrets and
other similar rights (collectively, "Intellectual Property Rights") reasonably
necessary to conduct their businesses as now conducted; and the expected
expiration of any of such Intellectual Property Rights would not result in a
Material Adverse Change. Neither the Company or any of its subsidiaries nor any
of the Founding Companies has received any notice of infringement or conflict
with asserted Intellectual Property Rights of others, which infringement or
conflict, if the subject of an unfavorable decision, would result in a Material
Adverse Change.

(p) All Necessary Permits, etc. The Company and each
subsidiary and each Founding Company possess such valid and current
certificates, authorizations, licenses or permits issued by the appropriate
state, federal or foreign regulatory agencies or bodies necessary to conduct
their respective businesses, and neither the Company or any subsidiary nor any
of the Founding Companies has received any notice of proceedings relating to the
revocation or modification of, or non-compliance with, any such certificate,
authorization, license or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, could result in a
Material Adverse Change.

(q) Title to Properties. The Company, each of its subsidiaries
and each Founding Company has good and marketable title to all the properties
and assets reflected as owned in the financial statements referred to in Section
1(i) above (or elsewhere in the Prospectus), in each case free and clear of any
security interests, mortgages, liens, encumbrances, equities, claims and other
defects, except such as do not materially and adversely affect the value of such
property and do not materially interfere with the use made or proposed to be
made of such property by the Company or such subsidiary or such Founding
Company. The real property, improvements, equipment and personal property held
under lease by the Company or any subsidiary or any Founding Company are held
under valid and enforceable leases, with such exceptions as are not material and
do not materially interfere with the use made or proposed to be made of such
real property, improvements, equipment or personal property by the Company or
such subsidiary or such Founding Company.

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<PAGE> 12
(r) Tax Law Compliance. The Company and its subsidiaries and
each of the Founding Companies have filed all necessary federal, state and
foreign income and franchise tax returns and have paid all taxes required to be
paid by any of them and, if due and payable, any related or similar assessment,
fine or penalty levied against any of them. The Company has made adequate
charges, accruals and reserves in the applicable financial statements referred
to in Section 1(i) above in respect of all federal, state and foreign income and
franchise taxes for all periods as to which the tax liability of the Company,
any of its subsidiaries or any Founding Company has not been finally determined.
The Company has no knowledge of any tax deficiency which might be asserted
against the Company or any of its subsidiaries or any of the Founding Companies
which could result in a Material Adverse Change.

(s) Company Not an "Investment Company" The Company has been
advised of the rules and requirements under the Investment Company Act of 1940,
as amended (the "Investment Company Act"). The Company is not, and after receipt
of payment for the Common Shares will not be, an "investment company" within the
meaning of Investment Company Act and will conduct its business in a manner so
that it will not become subject to the Investment Company Act.

(t) Insurance. Each of the Company and its subsidiaries and
the Founding Companies are insured by recognized, financially sound and
reputable institutions with policies in such amounts and with such deductibles
and covering such risks as are generally deemed adequate and customary for their
businesses including, but not limited to, policies covering real and personal
property owned or leased by the Company and its subsidiaries and the Founding
Companies against theft, damage, destruction, acts of vandalism and earthquakes.
The Company has no reason to believe that it or any subsidiary or any Founding
Company will not be able (i) to renew its existing insurance coverage as and
when such policies expire or (ii) to obtain comparable coverage from similar
institutions as may be necessary or appropriate to conduct its business as now
conducted and at a cost that would not result in a Material Adverse Change.
Neither of the Company or any subsidiary nor any Founding Company has been
denied any insurance coverage which it has sought or for which it has applied.

(u) No Price Stabilization or Manipulation. The Company has
not taken and will not take, directly or indirectly, any action designed to or
that might be reasonably expected to cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the sale or resale
of the Common Shares.

(v) Related Party Transactions. There are no business
relationships or related- party transactions involving the Company, any
subsidiary, any Founding Company or any other person required to be described in
the Prospectus which have not been described as required.

(w) No Unlawful Contributions or Other Payments. Neither the
Company or any of its subsidiaries nor any Founding Company nor, to the best of
the Company's knowledge, any employee or agent of the Company or any subsidiary
or any Founding Company, has made any contribution or other payment to any
official of, or candidate for, any federal, state or foreign office in violation
of any law or of the character required to be disclosed in the Prospectus.

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<PAGE> 13
(x) Accounting Systems. The Company and each of the Founding
Companies maintain a system of accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles as applied in the United States and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.

(y) Compliance with Environmental Laws. Except as would not,
individually or, in the aggregate, result in a Material Adverse Change (i)
neither the Company or any of its subsidiaries nor any Founding Company is in
violation of any federal, state, local or foreign law or regulation relating to
pollution or protection of human health or the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or subsurface
strata) or wildlife, including without limitation, laws and regulations relating
to emissions, discharges, releases or threatened releases of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum and petroleum products (collectively, "Materials of Environmental
Concern"), or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Materials of
Environment Concern (collectively, "Environmental Laws"), which violation
includes, but is not limited to, noncompliance with any permits or other
governmental authorizations required for the operation of the business of the
Company or its subsidiaries or the Founding Companies under applicable
Environmental Laws, or noncompliance with the terms and conditions thereof, nor
has the Company or any of its subsidiaries or any Founding Company received any
written communication, whether from a governmental authority, citizens group,
employee or otherwise, that alleges that the Company or any of its subsidiaries
or any Founding Company is in violation of any Environmental Law; (ii) there is
no claim, action or cause of action filed with a court or governmental
authority, no investigation with respect to which the Company or any Founding
Company has received written notice, and no written notice by any person or
entity alleging potential liability for investigatory costs, cleanup costs,
governmental responses costs, natural resources damages, property damages,
personal injuries, attorneys' fees or penalties arising out of, based on or
resulting from the presence, or release into the environment, of any location
owned, leased or operated by the Company or any of its subsidiaries or any
Founding Company, now or in the past (collectively, "Environmental Claims"),
pending or, to the best of the Company's knowledge, threatened against the
Company or any of its subsidiaries or any Founding Company or any person or
entity whose liability for any Environmental Claim the Company or any of its
subsidiaries or any Founding Company has retained or assumed either
contractually or by operation of law; and (iii) to the best of the Company's
knowledge, there are no past or present actions, activities, circumstances,
conditions, events or incidents, including, without limitation, the release,
emission, discharge, presence or disposal of any Material of Environmental
Concern, that reasonably could result in a violation of any Environmental Law or
form the basis of a potential Environmental Claim against the Company or any of
its subsidiaries or any Founding Company or against any person or entity whose
liability for any Environmental Claim the Company or any of its

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<PAGE> 14
subsidiaries or any Founding Company has retained or assumed either
contractually or by operation of law.

(z) ERISA Compliance. The Company, each of its subsidiaries
and each of the Founding Companies and any "employee benefit plan" (as defined
under the Employee Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder (collectively, "ERISA"))
established or maintained by the Company, any Founding Company or their "ERISA
Affiliates" (as defined below) are in compliance in all material respects with
ERISA. "ERISA Affiliate" means, with respect to the Company or a Founding
Company, any member of any group of organizations described in Sections
414(b),(c),(m) or (o) of the Internal Revenue Code of 1986, as amended, and the
regulations and published interpretations thereunder (the "Code") of which the
Company or such Founding Company is a member. No "reportable event" (as defined
under ERISA) has occurred or is reasonably expected to occur with respect to any
"employee benefit plan" established or maintained by the Company, any Founding
Company or any of their ERISA Affiliates. No "employee benefit plan" established
or maintained by the Company, any Founding Company or any of their ERISA
Affiliates, if such "employee benefit plan" were terminated, would have any
"amount of unfunded benefit liabilities" (as defined under ERISA). Neither the
Company, any Founding Company nor any of their ERISA Affiliates has incurred or
reasonably expects to incur any liability under (i) Title IV of ERISA with
respect to termination of, or withdrawal from, any "employee benefit plan" or
(ii) Sections 412, 4971, 4975 or 4980B of the Code. Each "employee benefit plan"
established or maintained by the Company, any Founding Company or any of their
ERISA Affiliates that is intended to be qualified under Section 401(a) of the
Code is so qualified and nothing has occurred, whether by action or failure to
act, which would cause the loss of such qualification.

(aa) Combination Agreements. The Company has entered into the
agreements (the "Combination Agreements"), filed as Exhibits _________ to the
Registration Statement, pursuant to which the Company will acquire in separate
Combinations all of the capital stock and ownership interests of the Founding
Companies. Each of the Combination Agreements is in full force and effect, has
been duly and validly authorized, executed and delivered by the parties thereto,
and is valid and binding on the parties thereto in accordance with its terms and
none of the parties thereto is in default in any respect thereunder. A complete
and correct copy of each Combination Agreement (including exhibits and
schedules) has been delivered to the Representatives and no changes therein will
be made subsequent hereto and prior to the Closing Date.

(bb) Representations in Combination Agreements. The
representations and warranties made in each Combination Agreement by the Company
and by each Founding Company and/or its stockholders are true and correct in all
material respects, except for such changes permitted or contemplated by such
Combination Agreement.

[Any certificate signed by an officer of the Company and delivered to
the Representatives or to counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company to each Underwriter as to the matters
set forth therein.]

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<PAGE> 15
SECTION 2. PURCHASE, SALE AND DELIVERY OF THE COMMON SHARES.

The Firm Common Shares. The Company agrees to issue and sell to the
several Underwriters the Firm Common Shares upon the terms herein set forth. On
the basis of the representations, warranties and agreements herein contained,
and upon the terms but subject to the conditions herein set forth, the
Underwriters agree, severally and not jointly, to purchase from the Company the
respective number of Firm Common Shares set forth opposite their names on
Schedule A. The purchase price per Firm Common Share to be paid by the several
Underwriters to the Company shall be $______ per share.

The First Closing Date. Delivery of certificates for the Firm Common
Shares to be purchased by the Underwriters and payment therefor shall be made at
the offices of NMS, 600 Montgomery Street, San Francisco, California (or such
other place as may be agreed to by the Company and the Representatives) at 6:00
a.m. San Francisco time, on , 1998 or such other time and date not later than
10:30 a.m. San Francisco time, on , 1998 as the Representatives shall designate
by notice to the Company (the time and date of such closing are called the
"First Closing Date"). The Company hereby acknowledges that circumstances under
which the Representatives may provide notice to postpone the First Closing Date
as originally scheduled include, but are in no way limited to, any determination
by the Company or the Representatives to recirculate to the public copies of an
amended or supplemented Prospectus or a delay as contemplated by the provisions
of Section 10.

The Optional Common Shares; the Second Closing Date. In addition, on
the basis of the representations, warranties and agreements herein contained,
and upon the terms but subject to the conditions herein set forth, the Company
hereby grants an option to the several Underwriters to purchase, severally and
not jointly, up to an aggregate of __________ Optional Common Shares from the
Company at the purchase price per share to be paid by the Underwriters for the
Firm Common Shares. The option granted hereunder is for use by the Underwriters
solely in covering any over-allotments in connection with the sale and
distribution of the Firm Common Shares. The option granted hereunder may be
exercised at any time (but not more than once) upon notice by the
Representatives to the Company, which notice may be given at any time within 30
days from the date of this Agreement. Such notice shall set forth (i) the
aggregate number of Optional Common Shares as to which the Underwriters are
exercising the option, (ii) the names and denominations in which the
certificates for the Optional Common Shares are to be registered and (iii) the
time, date and place at which such certificates will be delivered (which time
and date may be simultaneous with, but not earlier than, the First Closing Date;
and in such case the term "First Closing Date" shall refer to the time and date
of delivery of certificates for the Firm Common Shares and the Optional Common
Shares). Such time and date of delivery, if subsequent to the First Closing
Date, is called the "Second Closing Date" and shall be determined by the
Representatives and shall not be earlier than three nor later than five full
business days after delivery of such notice of exercise. If any Optional Common
Shares are to be purchased, each Underwriter agrees, severally and not jointly,
to purchase the number of Optional Common Shares (subject to such adjustments to
eliminate fractional shares as the Representatives may determine) that bears the
same proportion to the total number of Optional Common Shares to be purchased as
the number of Firm Common Shares set

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<PAGE> 16
forth on Schedule A opposite the name of such Underwriter bears to the total
number of Firm Common Shares. The Representatives may cancel the option at any
time prior to its expiration by giving written notice of such cancellation to
the Company.

Public Offering of the Common Shares. The Representatives hereby advise
the Company that the Underwriters intend to offer for sale to the public, as
described in the Prospectus, their respective portions of the Common Shares as
soon after this Agreement has been executed as the Representatives, in their
sole judgment, have determined is advisable and practicable.

Payment for the Common Shares. Payment for the Common Shares shall be
made at the First Closing Date (and, if applicable, at the Second Closing Date)
by wire transfer of immediately available funds to the order of the Company.

It is understood that the Representatives have been authorized, for
their own account and the accounts of the several Underwriters, to accept
delivery of and receipt for, and make payment of the purchase price for, the
Firm Common Shares and any Optional Common Shares the Underwriters have agreed
to purchase. NMS, individually and not as a Representative of the Underwriters,
may (but shall not be obligated to) make payment for any Common Shares to be
purchased by any Underwriter whose funds shall not have been received by the
Representatives by the First Closing Date or the Second Closing Date, as the
case may be, for the account of such Underwriter, but any such payment shall not
relieve such Underwriter from any of its obligations under this Agreement.

Delivery of the Common Shares. The Company shall deliver, or cause to
be delivered, to the Representatives for the accounts of the several
Underwriters certificates for the Firm Common Shares at the First Closing Date,
against the irrevocable release of a wire transfer of immediately available
funds for the amount of the purchase price therefor. The Company shall also
deliver, or cause to be delivered, to the Representatives for the accounts of
the several Underwriters, certificates for the Optional Common Shares the
Underwriters have agreed to purchase at the First Closing Date or the Second
Closing Date, as the case may be, against the irrevocable release of a wire
transfer of immediately available funds for the amount of the purchase price
therefor. The certificates for the Common Shares shall be in definitive form and
registered in such names and denominations as the Representatives shall have
requested at least two full business days prior to the First Closing Date (or
the Second Closing Date, as the case may be) and shall be made available for
inspection on the business day preceding the First Closing Date (or the Second
Closing Date, as the case may be) at a location in New York City as the
Representatives may designate. Time shall be of the essence, and delivery at the
time and place specified in this Agreement is a further condition to the
obligations of the Underwriters.

Delivery of Prospectus to the Underwriters. Not later than 12:00 p.m.
(New York City time) on the second business day following the date the Common
Shares are released by the Underwriters for sale to the public, the Company
shall deliver or cause to be delivered copies of the Prospectus in such
quantities and at such places as the Representatives shall request.

SECTION 3. ADDITIONAL COVENANTS OF THE COMPANY. THE COMPANY FURTHER

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<PAGE> 17
COVENANTS AND AGREES WITH EACH UNDERWRITER AS FOLLOWS:

(a) Representatives' Review of Proposed Amendments and
Supplements. During such period beginning on the date hereof and ending on the
later of the First Closing Date or such date, as in the opinion of counsel for
the Underwriters, the Prospectus is no longer required by law to be delivered in
connection with sales by an Underwriter or dealer (the "Prospectus Delivery
Period"), prior to amending or supplementing the Registration Statement
(including any registration statement filed under Rule 462(b) under the
Securities Act) or the Prospectus, the Company shall furnish to the
Representatives for review a copy of each such proposed amendment or supplement,
and the Company shall not file any such proposed amendment or supplement to
which the Representatives reasonably object.

(b) Securities Act Compliance. After the date of this
Agreement, the Company shall promptly advise the Representatives in writing (i)
of the receipt of any comments of, or requests for additional or supplemental
information from, the Commission, (ii) of the time and date of any filing of any
post-effective amendment to the Registration Statement or any amendment or
supplement to any preliminary prospectus or the Prospectus, (iii) of the time
and date that any post-effective amendment to the Registration Statement becomes
effective and (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or any post-effective
amendment thereto or of any order preventing or suspending the use of any
preliminary prospectus or the Prospectus, or of any proceedings to remove,
suspend or terminate from listing or quotation the Common Stock from any
securities exchange upon which it is listed for trading or included or
designated for quotation, or of the threatening or initiation of any proceedings
for any of such purposes. If the Commission shall enter any such stop order at
any time, the Company will use its best efforts to obtain the lifting of such
order at the earliest possible moment. Additionally, the Company agrees that it
shall comply with the provisions of Rules 424(b), 430A and 434, as applicable,
under the Securities Act and will use its reasonable efforts to confirm that any
filings made by the Company under such Rule 424(b) were received in a timely
manner by the Commission.

(c) Amendments and Supplements to the Prospectus and Other
Securities Act Matters. If, during the Prospectus Delivery Period, any event
shall occur or condition exist as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if in the opinion of the Representatives or counsel for the
Underwriters it is otherwise necessary to amend or supplement the Prospectus to
comply with law, the Company agrees to promptly prepare (subject to Section 3(a)
hereof), file with the Commission and furnish at its own expense to the
Underwriters and to dealers, amendments or supplements to the Prospectus so that
the statements in the Prospectus as so amended or supplemented will not, in the
light of the circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will comply
with law.

(d) Copies of any Amendments and Supplements to the
Prospectus. The Company agrees to furnish the Representatives, without charge,
during the Prospectus Delivery

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<PAGE> 18
Period, as many copies of the Prospectus and any amendments and supplements
thereto as the Representatives may request.

(e) Blue Sky Compliance. The Company shall cooperate with the
Representatives and counsel for the Underwriters to qualify or register the
Common Shares for sale under (or obtain exemptions from the application of) the
Blue Sky or state securities laws or Canadian provincial securities laws of
those jurisdictions designated by the Representatives, shall comply with such
laws and shall continue such qualifications, registrations and exemptions in
effect so long as required for the distribution of the Common Shares. The
Company shall not be required to qualify as a foreign corporation or to take any
action that would subject it to general service of process in any such
jurisdiction where it is not presently qualified or where it would be subject to
taxation as a foreign corporation. The Company will advise the Representatives
promptly of the suspension of the qualification or registration of (or any such
exemption relating to) the Common Shares for offering, sale or trading in any
jurisdiction or any initiation or threat of any proceeding for any such purpose,
and in the event of the issuance of any order suspending such qualification,
registration or exemption, the Company shall use its best efforts to obtain the
withdrawal thereof at the earliest possible moment.

(f) Use of Proceeds. The Company shall apply the net proceeds
from the sale of the Common Shares sold by it in the manner described under the
caption "Use of Proceeds" in the Prospectus.

(g) Transfer Agent. The Company shall engage and maintain, at
its expense, a registrar and transfer agent for the Common Stock.

(h) Earnings Statement. As soon as practicable, the Company
will make generally available to its security holders and to the Representatives
an earnings statement (which need not be audited) covering the twelve-month
period ending that satisfies the provisions of Section 11(a) of
the Securities Act.

(i) Periodic Reporting Obligations. During the Prospectus
Delivery Period the Company shall file, on a timely basis, with the Commission
and the New York Stock Exchange all reports and documents required to be filed
under the Exchange Act. Additionally, the Company shall include in its Form 10-Q
filed with the Commission all information required under Rule 463 under the
Securities Act.

(j) Agreement Not To Offer or Sell Additional Securities.
During the period of 180 days following the date of the Prospectus, the Company
will not, without the prior written consent of NMS (which consent may be
withheld at the sole discretion of NMS), directly or indirectly, sell, offer,
contract or grant any option to sell, pledge, transfer or establish an open "put
equivalent position" within the meaning of Rule 16a-l(h) under the Exchange Act,
or otherwise dispose of or transfer, or announce the offering of, or file any
registration statement under the Securities Act in respect of, any shares of
Common Stock, options or warrants to acquire shares of the Common Stock or
securities exchangeable or exercisable for or convertible into shares of

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<PAGE> 19
Common Stock (other than as contemplated by this Agreement with respect to the
Common Shares); provided, however, that the Company may (i) issue shares
constituting Additional Consideration (as defined in the Prospectus), (ii) grant
options to purchase Common Stock under any stock option, stock bonus or other
stock plan or arrangement described in the Prospectus, provided that no such
options will become exercisable during the 180-day period, (iii) issue shares of
Common Stock pursuant to the exercise of the warrants held by Paul M. Verrochi
and Dominic J. Puopolo, and (iv) issue shares of Common Stock in connection with
the acquisition of additional training and development companies, but only if
the holders of such shares agree in writing not to sell, offer, dispose of or
otherwise transfer any such shares during such 180-day period without the prior
written consent of NMS (which consent may be withheld at the sole discretion of
the NMS).

(k) Future Reports to the Representatives. During the period
of five years after the date of this Agreement, so long as the Company is
subject to the reporting requirements of the Securities Exchange Act of 1934,
the Company will furnish to the Representatives (i) as soon as practicable after
the end of each fiscal year, copies of the Annual Report of the Company
containing the balance sheet of the Company as of the close of such fiscal year
and statements of income, stockholders' equity and cash flows for the year then
ended and the opinion thereon of the Company's independent public or certified
public accountants; (ii) as soon as practicable after the filing thereof, copies
of each proxy statement, Annual Report on Form 10-K, Quarterly Report on Form
10-Q, Current Report on Form 8-K or other report filed by the Company with the
Commission, the NASD or any securities exchange; and (iii) as soon as available,
copies of any report or communication of the Company mailed generally to holders
of its capital stock.

(l) Satisfaction of Founding Company Combination Conditions.
The Company will: (i) use its best efforts to satisfy all conditions to
consummation of the Founding Company Combinations as set forth in the
Combination Agreements with respect thereto; (ii) use its best efforts to cause
each other party to such Combination Agreements to satisfy all conditions to the
consummation of the Founding Company Combinations; and (iii) promptly notify the
Representatives of the occurrence of any event which may result in the
non-consummation of any of the Founding Company Combinations on the First
Closing Date.

NMS, on behalf of the several Underwriters, may, in its sole
discretion, waive in writing the performance by the Company of any one or more
of the foregoing covenants or extend the time for their performance.

SECTION 4. PAYMENT OF EXPENSES. The Company agrees to pay all costs,
fees and expenses incurred in connection with the performance of its obligations
under this Agreement and in connection with the transactions contemplated hereby
and in connection with the Founding Company Combinations, including without
limitation (i) all expenses incident to the issuance and delivery of the Common
Shares (including all printing and engraving costs), (ii) all fees and expenses
of the registrar and transfer agent of the Common Stock, (iii) all necessary
issue, transfer and other stamp taxes in connection with the issuance and sale
of the Common Shares to the Underwriters, (iv) all fees and expenses of the
Company's counsel, independent public or certified public accountants and other
advisors, (v) all costs and expenses incurred in connection with the

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<PAGE> 20
preparation, printing, filing, shipping and distribution of the Registration
Statement (including financial statements, exhibits, schedules, consents and
certificates of experts), each preliminary prospectus and the Prospectus, and
all amendments and supplements thereto, and this Agreement, (vi) all filing
fees, attorneys' fees and expenses incurred by the Company or the Underwriters
in connection with qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Common Shares for offer
and sale under the Blue Sky laws, and, if requested by the Representatives,
preparing and printing a "Blue Sky Survey" or memorandum, and any supplements
thereto, advising the Underwriters of such qualifications, registrations and
exemptions, (vii) the filing fees incident to, and the reasonable fees and
expenses of counsel for the Underwriters in connection with, the NASD's review
and approval of the Underwriters' participation in the offering and distribution
of the Common Shares, (viii) the fees and expenses associated with listing the
Common Shares on the New York Stock Exchange, and (ix) all other fees, costs and
expenses referred to in Item 14 of Part II of the Registration Statement. Except
as provided in this Section 4, Section 6, Section 8 and Section 9 hereof, the
Underwriters shall pay their own expenses, including the fees and disbursements
of their counsel.

SECTION 5. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Common
Shares as provided herein on the First Closing Date and, with respect to the
Optional Common Shares, the Second Closing Date, shall be subject to the
accuracy of the representations and warranties on the part of the Company set
forth in Section 1 hereof as of the date hereof and as of the First Closing Date
as though then made and, with respect to the Optional Common Shares, as of the
Second Closing Date as though then made, to the timely performance by the
Company of its covenants and other obligations hereunder, and to each of the
following additional conditions:

(a) Accountants' Comfort Letter. On the date hereof the
Representatives shall have received from each of KPMG Peat Marwick, LLP,
independent public or certified public accountants for the Company, and
[Friedman & Fuller, P.C.], independent public or certified public accountants
for Star Mountain, Inc., a letter dated the date hereof addressed to the
Underwriters, in form and substance satisfactory to the Representatives,
containing statements and information of the type ordinarily included in
accountant's "comfort letters" to underwriters, delivered according to Statement
of Auditing Standards No. 72 (or any successor bulletin), with respect to the
audited and unaudited financial statements and certain financial information
contained in the Registration Statement and the Prospectus (and the
Representatives shall have received an additional __ conformed copies of such
accountants' letter for each of the several Underwriters). The specified date
referred to therein for the carrying out of procedures shall be no more than
three business days prior to the date of this Agreement.

(b) Compliance with Registration Requirements; No Stop Order;
No Objection from NASD. For the period from and after effectiveness of this
Agreement and prior to the First Closing Date and, with respect to the Optional
Common Shares, the Second Closing Date:

(i) the Company shall have filed the Prospectus with the
Commission (including the information required by Rule 430A under the
Securities Act) in the manner and within

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<PAGE> 21
the time period required by Rule 424(b) under the Securities Act; or
the Company shall have filed a post-effective amendment to the
Registration Statement containing the information required by such Rule
430A, and such post-effective amendment shall have become effective;
or, if the Company elected to rely upon Rule 434 under the Securities
Act and obtained the Representatives' consent thereto, the Company
shall have filed a Term Sheet with the Commission in the manner and
within the time period required by such Rule 424(b);

(ii) no stop order suspending the effectiveness of the
Registration Statement, any Rule 462(b) Registration Statement, or any
post-effective amendment to the Registration Statement, shall be in
effect and no proceedings for such purpose shall have been instituted
or threatened by the Commission; and

(iii) the NASD shall have raised no objection to the fairness
and reasonableness of the underwriting terms and arrangements.

(c) No Material Adverse Change or Ratings Agency Change. For
the period from and after the date of this Agreement and prior to the First
Closing Date and, with respect to the Optional Common Shares, the Second Closing
Date:

(i) in the judgment of the Representatives there shall not
have occurred any Material Adverse Change; and

(ii) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any securities
of the Company or any of its subsidiaries by any "nationally recognized
statistical rating organization" as such term is defined for purposes
of Rule 436(g)(2) under the Securities Act.

(d) Opinion of Counsel for the Company. On each of the First
Closing Date and the Second Closing Date the Representatives shall have received
the favorable opinion of Nutter, McClennen & Fish, LLP, counsel for the Company,
dated as of such Closing Date, the form of which is attached as Exhibit A (and
the Representatives shall have received an additional __ conformed copies of
such counsel's legal opinion for each of the several Underwriters).

(e) Opinion of Counsel for the Underwriters. On each of the
First Closing Date and the Second Closing Date the Representatives shall have
received the favorable opinion of Ropes & Gray, counsel for the Underwriters,
dated as of such Closing Date, with respect to the matters set forth in
paragraphs (i), (vii) (with respect to subparagraph (a) only), (viii), (ix),
(x), (xiii) (with respect to the captions "Description of Capital Stock" and
"Underwriters" under subparagraph (a) only) and (xi) and the next-to-last
paragraph of Exhibit A (and the Representatives shall have received an
additional __ conformed copies of such counsel's legal opinion for each of the
several Underwriters).

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<PAGE> 22
(f) Officers' Certificate. On each of the First Closing Date
and the Second Closing Date the Representatives shall have received a written
certificate executed by the Chairman of the Board, Chief Executive Officer or
President of the Company and the Chief Financial Officer or Chief Accounting
Officer of the Company, dated as of such Closing Date, to the effect set forth
in subsections (b)(ii) and (c)(ii) of this Section 5, and further to the effect
that:

(i) for the period from and after the date of this Agreement
and prior to such Closing Date, there has not occurred any Material
Adverse Change;

(ii) the representations, warranties and covenants of the
Company set forth in Section 1 of this Agreement are true and correct
with the same force and effect as though expressly made on and as of
such Closing Date; and

(iii) the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied
at or prior to such Closing Date.

(g) Bring-down Comfort Letter. On each of the First Closing
Date and the Second Closing Date the Representatives shall have received from
KPMG Peat Marwick, LLP independent public or certified public accountants for
the Company, and Friedman & Fuller, P.C., independent public or certified public
accountants for Star Mountain, Inc., a letter dated such date, in form and
substance satisfactory to the Representatives, to the effect that they reaffirm
the statements made in the letter furnished by them pursuant to subsection (a)
of this Section 5, except that the specified date referred to therein for the
carrying out of procedures shall be no more than three business days prior to
the First Closing Date or Second Closing Date, as the case may be (and the
Representatives shall have received an additional __ conformed copies of such
accountants' letter for each of the several Underwriters).

(h) Combination Closings. With respect to the Founding
Company Combinations:

(i) Each condition to the obligations of the Company set
forth in Section __ of each of the Combination Agreements shall have
been satisfied, without waiver or modification, except as may be
approved by the Representatives.

(ii) Each certificate delivered to the Company pursuant to
each Combination Agreement shall have also been delivered to the
Representatives.

(iii) Counsel for each of the Founding Companies shall have
furnished to the Representatives a letter, in form and substance
satisfactory to the Representatives, to the effect that they are
entitled to rely on the opinion of such counsel delivered to the
Company pursuant to each Combination Agreement as if such opinion were
addressed to them.

(iv) On the First Closing Date the Representatives shall have
received opinions, in form and substance satisfactory to the
Representatives, from counsel for the Company and

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<PAGE> 23
counsel for each of the Founding Companies, to the effect that each
Combination pursuant to the respective Combination Agreement has become
effective and that such Combination was consummated in accordance with
the provisions of the Combination Agreement, which has been duly
authorized by the Company, the respective Founding Company and their
respective stockholders, and comply in all respects with applicable
law.

(i) Combination Agreements. The Combination Agreements shall
be in full force and effect and none of the parties thereto shall be in default
thereunder. The Representatives shall have received assurances reasonably
satisfactory to it that all documents required to be filed in the respective
states in order to effectuate the consummation of each Combination shall have
been approved for filing by the appropriate authorities in each state and that
all of such Combination documents shall be filed substantially concurrently with
the consummation of the transactions pursuant to this Agreement.

(j) Lock-Up Agreement from Certain Stockholders of the
Company. On the date hereof, the Company shall have furnished to the
Representatives an agreement in the form of Exhibit B hereto from each director,
officer and each beneficial owner of Common Stock (as defined and determined
according to Rule 13d-3 under the Exchange Act, except that a one hundred eighty
day period shall be used rather than the sixty day period set forth therein),
including, without limitation, each person who will receive shares of Common
Stock pursuant to the terms of the Combination Agreements, and such agreement
shall be in full force and effect on each of the First Closing Date and the
Second Closing Date.

(k) Additional Documents. On or before each of the First
Closing Date and the Second Closing Date, the Representatives and counsel for
the Underwriters shall have received such information, documents and opinions as
they may reasonably require for the purposes of enabling them to pass upon the
issuance and sale of the Common Shares as contemplated herein, or in order to
evidence the accuracy of any of the representations and warranties, or the
satisfaction of any of the conditions or agreements, herein contained.

If any condition specified in this Section 5 is not satisfied when and
as required to be satisfied, this Agreement may be terminated by the
Representatives by notice to the Company at any time on or prior to the First
Closing Date and, with respect to the Optional Common Shares, at any time prior
to the Second Closing Date, which termination shall be without liability on the
part of any party to any other party, except that Section 4, Section 6, Section
8 and Section 9 shall at all times be effective and shall survive such
termination.

SECTION 6. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If this Agreement
is terminated by the Representatives pursuant to Section 5, Section 7, Section
10 or Section 11, or if the sale to the Underwriters of the Common Shares on the
First Closing Date is not consummated because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or to comply
with any provision hereof, the Company agrees to reimburse the Representatives
and the other Underwriters (or such Underwriters as have terminated this
Agreement with respect to themselves), severally, upon demand for all
out-of-pocket expenses that shall have been

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<PAGE> 24
reasonably incurred by the Representatives and the Underwriters in connection
with the proposed purchase and the offering and sale of the Common Shares,
including but not limited to fees and disbursements of counsel, printing
expenses, travel expenses, postage, facsimile and telephone charges.

SECTION 7. EFFECTIVENESS OF THIS AGREEMENT.

This Agreement shall become effective upon the execution of this
Agreement by the parties hereto.

SECTION 8. INDEMNIFICATION.

(a) Indemnification of the Underwriters by the Company. The
Company and its subsidiaries, jointly and severally, agrees to indemnify and
hold harmless each Underwriter, its officers and employees, and each person, if
any, who controls any Underwriter within the meaning of the Securities Act and
the Exchange Act against any loss, claim, damage, liability or expense, as
incurred, to which such Underwriter or such controlling person may become
subject, under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of the Company), insofar as such loss, claim, damage, liability or
expense (or actions in respect thereof as contemplated below) arises out of or
is based (i) upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, or any amendment thereto,
including any information deemed to be a part thereof pursuant to Rule 430A or
Rule 434 under the Securities Act, or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make the
statements therein not misleading; or (ii) upon any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; or (iii) in whole or in part upon any inaccuracy in the
representations and warranties of the Company contained herein; or (iv) in whole
or in part upon any failure of the Company to perform its obligations hereunder
or under law; or (v) any act or failure to act or any alleged act or failure to
act by any Underwriter in connection with, or relating in any manner to, the
Common Stock or the offering contemplated hereby and which is included as part
of or referred to in any loss, claim, damage, liability or action arising out of
or based upon any matter covered by clause (i) or (ii) above, provided that
neither the Company nor any of its subsidiaries shall be liable under this
clause (v) to the extent that a court of competent jurisdiction shall have
determined by a final judgment that such loss, claim, damage, liability or
action resulted directly from any such acts or failures to act undertaken or
omitted to be taken by such Underwriter through its bad faith or willful
misconduct; and to reimburse each Underwriter and each such controlling person
for any and all expenses (including the fees and disbursements of counsel chosen
by NMS) as such expenses are reasonably incurred by such Underwriter or such
controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action; provided, however, that the foregoing indemnity agreement shall not
apply to any loss, claim, damage, liability or expense to the extent,

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but only to the extent, arising out of or based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with written information furnished to the Company by the
Representatives expressly for use in the Registration Statement, any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto); and
provided, further, that with respect to any preliminary prospectus, the
foregoing indemnity agreement shall not inure to the benefit of any Underwriter
from whom the person asserting any loss, claim, damage, liability or expense
purchased Common Shares, or any person controlling such Underwriter, if copies
of the Prospectus were timely delivered to the Underwriter pursuant to Section 2
and a copy of the Prospectus (as then amended or supplemented if the Company
shall have furnished any amendments or supplements thereto) was not sent or
given by or on behalf of such Underwriter to such person, if required by law so
to have been delivered, at or prior to the written confirmation of the sale of
the Common Shares to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage, liability or expense. The indemnity agreement set forth in this Section
8(a) shall be in addition to any liabilities that the Company and the
subsidiaries may otherwise have.

(b) Indemnification of the Underwriters by the Founders. Each
of the stockholders of the Founding Companies listed on Schedule B (the "Inside
Founders") who receives cash consideration under the Combination Agreements
severally agrees to indemnify and hold harmless each Underwriter, its officers
and employees, and each person, if any, who controls any Underwriter within the
meaning of the Securities Act and the Exchange Act against any loss, claim,
damage, liability or expense, as incurred, to which such Underwriter or such
controlling person may become subject, under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, or at common law or
otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of the Company), insofar as such loss, claim,
damage, liability or expense (or actions in respect thereof as contemplated
below) arises out of or is based (i) upon any untrue statement or alleged untrue
statement of a material fact relating to the Founding Company of which such
Inside Founder was a stockholder that is contained in the Registration
Statement, or any amendment thereto, including any information deemed to be a
part thereof pursuant to Rule 430A or Rule 434 under the Securities Act, or the
omission or alleged omission therefrom of a material fact relating to such
Founding Company that is required to be stated therein or necessary to make the
statements therein not misleading; or (ii) upon any untrue statement or alleged
untrue statement of a material fact relating to such Founding Company that is
contained in any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a material
fact relating to such Founding Company that is necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that with respect to any preliminary
prospectus, the foregoing indemnity agreement shall not inure to the benefit of
any Underwriter from whom the person asserting any loss, claim, damage,
liability or expense purchased Common Shares, or any person controlling such
Underwriter, if copies of the Prospectus were timely delivered to the
Underwriter pursuant to Section 2 and a copy of the Prospectus (as then amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of such Underwriter
to such person, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the Common Shares to such person, and if the

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Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such loss, claim, damage, liability or expense; and provided, further,
that the liability of each Inside Founder under the foregoing indemnity
agreement shall be limited to an amount equal to the cash consideration received
by such Inside Founder under the Combination Agreements. The indemnity agreement
set forth in this Section 8(b) shall be in addition to any liabilities that the
Inside Founders may otherwise have.

(c) Indemnification of the Company, its Directors and
Officers. Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its subsidiaries, each of its directors, each of its
officers who signed the Registration Statement, the Inside Founders and each
person, if any, who controls the Company within the meaning of the Securities
Act or the Exchange Act, against any loss, claim, damage, liability or expense,
as incurred, to which the Company, its subsidiaries, the Inside Founders or any
such director, officer or controlling person may become subject, under the
Securities Act, the Exchange Act, or other federal or state statutory law or
regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of such
Underwriter), insofar as such loss, claim, damage, liability or expense (or
actions in respect thereof as contemplated below) arises out of or is based upon
any untrue or alleged untrue statement of a material fact contained in the
Registration Statement, any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto), or arises out of or is based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in the Registration
Statement, any preliminary prospectus, the Prospectus (or any amendment or
supplement thereto), in reliance upon and in conformity with written information
furnished to the Company by the Representatives expressly for use therein; and
to reimburse the Company, its subsidiaries, the Inside Founders or any such
director, officer or controlling person for any legal and other expense
reasonably incurred by the Company, its subsidiaries, the Inside Founders or any
such director, officer or controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action. Each of the Company, its subsidiaries and the
Inside Founders hereby acknowledges that the only information that the
Underwriters have furnished to the Company expressly for use in the Registration
Statement, any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) are the statements set forth (A) as the last paragraph on
the inside front cover page of the Prospectus concerning stabilization by the
Underwriters and (B) in the table after the first paragraph and in the [third,
sixth and seventh] paragraphs under the caption "Underwriting" in the
Prospectus; and the Underwriters confirm that such statements are correct. The
indemnity agreement set forth in this Section 8(c) shall be in addition to any
liabilities that each Underwriter may otherwise have.

(d) Notifications and Other Indemnification Procedures.
Promptly after receipt by an indemnified party under this Section 8 of notice of
the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party under this Section
8, notify the indemnifying party in writing of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have

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<PAGE> 27
to any indemnified party for contribution or otherwise than under the indemnity
agreement contained in this Section 8 or to the extent it is not prejudiced as a
proximate result of such failure. In case any such action is brought against any
indemnified party and such indemnified party seeks or intends to seek indemnity
from an indemnifying party, the indemnifying party will be entitled to
participate in and, to the extent that it shall elect, jointly with all other
indemnifying parties similarly notified, by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, if the defendants in
any such action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that a conflict may
arise between the positions of the indemnifying party and the indemnified party
in conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of such indemnifying party's election so to
assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable to such indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with local counsel), approved by the indemnifying
party (NMS in the case of Section 8(c) and Section 9), representing the
indemnified parties who are parties to such action) or (ii) the indemnifying
party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action, in each of which cases the fees and expenses of
counsel shall be at the expense of the indemnifying party.

(e) Settlements. The indemnifying party under this Section 8
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by Section 8(d) hereof, the indemnifying party agrees that it shall
be liable for any settlement of any proceeding effected without its written
consent if (i) such settlement is entered into more than 30 days after receipt
by such indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity was or could have been sought
hereunder by such indemnified party, unless such settlement, compromise or
consent includes an

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<PAGE> 28
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such action, suit or proceeding.

SECTION 9. CONTRIBUTION.

If the indemnification provided for in Section 8 is for any reason held
to be unavailable to or otherwise insufficient to hold harmless an indemnified
party in respect of any losses, claims, damages, liabilities or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount paid or payable by such indemnified party, as incurred, as a
result of any losses, claims, damages, liabilities or expenses referred to
therein (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company, its subsidiaries and the Inside Founders, on
the one hand, and the Underwriters, on the other hand, from the offering of the
Common Shares pursuant to this Agreement or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company, its subsidiaries and the
Inside Founders on the one hand, and the Underwriters, on the other hand, in
connection with the statements or omissions or inaccuracies in the
representations and warranties herein which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company and its
subsidiaries, on the one hand, and the Underwriters, on the other hand, in
connection with the offering of the Common Shares pursuant to this Agreement
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of the Common Shares pursuant to this Agreement
(before deducting expenses) received by the Company and the total underwriting
discount received by the Underwriters, in each case as set forth on the front
cover page of the Prospectus (or, if Rule 434 under the Securities Act is used,
the corresponding location on the Term Sheet) bear to the aggregate initial
public offering price of the Common Shares as set forth on such cover. The
benefits received by each Inside Founder shall be deemed to be the total cash
proceeds received by such Inside Founder as consideration pursuant to the
Combination Agreements. The relative fault of the Company, its subsidiaries and
the Inside Founders, on the one hand, and the Underwriters, on the other hand,
shall be determined by reference to, among other things, whether any such untrue
or alleged untrue statement of a material fact or omission or alleged omission
to state a material fact or any such inaccurate or alleged inaccurate
representation or warranty relates to information supplied by the Company, its
subsidiaries or such Inside Founder, on the one hand, or the Underwriters, on
the other hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.

The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section 8(d), any legal or
other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 8(d) with respect to notice of commencement of any action shall apply if
a claim for contribution is to be made under this Section 9; provided, however,
that no additional notice shall be required with respect to any action for which
notice has been given under Section 8(d) for purposes of indemnification.

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<PAGE> 29
The Company, its subsidiaries, the Inside Founders and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
Section 9 were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to in this
Section 9.

Notwithstanding the provisions of this Section 9, no Underwriter shall
be required to contribute any amount in excess of the underwriting commissions
received by such Underwriter in connection with the Common Shares underwritten
by it and distributed to the public. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 9 are several, and not joint, in proportion to their
respective underwriting commitments as set forth opposite their names in
Schedule A. For purposes of this Section 9, each officer and employee of an
Underwriter and each person, if any, who controls an Underwriter within the
meaning of the Securities Act and the Exchange Act shall have the same rights to
contribution as such Underwriter, and each director of the Company, each officer
of the Company who signed the Registration Statement, and each person, if any,
who controls the Company with the meaning, of the Securities Act and the
Exchange Act shall have the same rights to contribution as the Company.

SECTION 10. DEFAULT OF ONE OR MORE OF THE SEVERAL UNDERWRITERS. If, on
the First Closing Date or the Second Closing Date, as the case may be, any one
or more of the several Underwriters shall fail or refuse to purchase Common
Shares that it or they have agreed to purchase hereunder on such date, and the
aggregate number of Common Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase does not exceed 10% of the
aggregate number of the Common Shares to be purchased on such date, the other
Underwriters shall be obligated, severally, in the proportions that the number
of Firm Common Shares set forth opposite their respective names on Schedule A
bears to the aggregate number of Firm Common Shares set forth opposite the names
of all such non-defaulting Underwriters, or in such other proportions as may be
specified by the Representatives with the consent of the nondefaulting
Underwriters, to purchase the Common Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date. If, on the
First Closing Date or the Second Closing Date, as the case may be, any one or
more of the Underwriters shall fail or refuse to purchase Common Shares and the
aggregate number of Common Shares with respect to which such default occurs
exceeds 10% of the aggregate number of Common Shares to be purchased on such
date, and arrangements satisfactory to the Representatives and the Company for
the purchase of such Common Shares are not made within 48 hours after such
default, this Agreement shall terminate without liability of any party (other
than the defaulting Underwriter) to any other party except that the provisions
of Section 4, Section 6, Section 8 and Section 9 shall at all times be effective
and shall survive such termination. In any such case either the Representatives
or the Company shall have the right to postpone the First Closing Date or the
Second Closing Date, as the case may be, but in no event for longer than seven
days in order that the required changes, if any, to the Registration Statement
and the Prospectus or any other documents or arrangements may be effected.

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<PAGE> 30
As used in this Agreement, the term "Underwriter" shall be deemed to
include any person substituted for a defaulting Underwriter under this Section
10. Any action taken under this Section 10 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.

SECTION 11. TERMINATION OF THIS AGREEMENT. Prior to the First Closing
Date this Agreement maybe terminated by the Representatives by notice given to
the Company if at any time (i) trading or quotation in any of the Company's
securities shall have been suspended or limited by the Commission or by the New
York Stock Exchange or trading in securities generally on either the Nasdaq
Stock Market or the New York Stock Exchange shall have been suspended or
limited, or minimum or maximum prices shall have been generally established on
any of such stock exchanges by the Commission or the NASD; (ii) a general
banking moratorium shall have been declared by any of federal, New York,
Delaware or California authorities; (iii) there shall have occurred any outbreak
or escalation of national or international hostilities or any crisis or
calamity, or any change in the United States or international financial markets,
or any substantial change or development involving a prospective substantial
change in United States or international political, financial or economic
conditions, as in the judgment of the Representatives is material and adverse
and makes it impracticable to market the Common Shares in the manner and on the
terms described in the Prospectus or to enforce contracts for the sale of
securities; (iv) in the judgment of the Representatives there shall have
occurred any Material Adverse Change; or (v) the Company shall have sustained a
loss by strike, fire, flood, earthquake, accident or other calamity of such
character as in the judgment of the Representatives may interfere materially
with the conduct of the business and operations of the Company regardless of
whether or not such loss shall have been insured. Any termination pursuant to
this Section 11 shall be without liability on the part of (a) the Company, its
subsidiaries or the Inside Founders to any Underwriter, except that the Company
shall be obligated to reimburse the expenses of the Representatives and the
Underwriters pursuant to Sections 4 and 6 hereof, (b) any Underwriter to the
Company, its subsidiaries or the Inside Founders or (c) any party hereto to any
other party except that the provisions of Section 8 and Section 9 shall at all
times be effective and shall survive such termination.

SECTION 12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, of its officers, its subsidiaries, the Inside
Founders and of the several Underwriters set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of any Underwriter or the Company or any of its or their
partners, officers or directors or any controlling person, as the case may be,
and will survive delivery of and payment for the Common Shares sold hereunder
and any termination of this Agreement.

SECTION 13. NOTICES. All communications hereunder shall be in writing
and shall be mailed, hand delivered or telecopied and confirmed to the parties
hereto as follows:

If to the Representatives:

NationsBanc Montgomery Securities, Inc.

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<PAGE> 31
600 Montgomery Street
San Francisco, California 94111
Facsimile: 415-249-5558
Attention: Mr. Richard A. Smith

with a copy to:

NationsBanc Montgomery Securities, Inc.
600 Montgomery Street
San Francisco, California 94111
Facsimile: (415) 249-5553
Attention: David A. Baylor, Esq.

If to the Company:

Provant, Inc.
67 Batterymarch Street, Suite 500
Boston, Massachusetts 02110
Facsimile: (617)
Attention:

Any party hereto may change the address for receipt of communications by giving
written notice to the others.

SECTION 14. SUCCESSORS. This Agreement will inure to the benefit of and
be binding upon the parties hereto, including any substitute Underwriters
pursuant to Section 10 hereof, and to the benefit of the employees, officers and
directors and controlling persons referred to in Section 8 and Section 9, and in
each case their respective successors, and no other person will have any right
or obligation hereunder. The term "successors" shall not include any purchaser
of the Common Shares as such from any of the Underwriters merely by reason of
such purchase.

SECTION 15. PARTIAL UNENFORCEABILITY. The invalidity or
unenforceability of any Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Section, paragraph or
provision hereof. If any Section, paragraph or provision of this Agreement is
for any reason determined to be invalid or unenforceable, there shall be deemed
to be made such minor changes (and only such minor changes) as are necessary to
make it valid and enforceable.

SECTION 16. GOVERNING LAW PROVISIONS. (a) THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.

(b) Consent to Jurisdiction. Any legal suit, action or
proceeding arising out of or based upon this Agreement or the transactions
contemplated hereby ("Related Proceedings") may be

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<PAGE> 32
instituted in the federal courts of the United States of America located in the
City and County of San Francisco or the courts of the State of California in
each case located in the City and County of San Francisco (collectively, the
"Specified Courts"), and each party irrevocably submits to the exclusive
jurisdiction (except for proceedings instituted in regard to the enforcement of
a judgment of any such court (a "Related Judgment"), as to which such
jurisdiction is non-exclusive) of such courts in any such suit, action or
proceeding. Service of any process, summons, notice or document by mail to such
party's address set forth above shall be effective service of process for any
suit, action or other proceeding brought in any such court. The parties
irrevocably and unconditionally waive any objection to the laying of venue of
any suit, action or other proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any such court that any
such suit, action or other proceeding brought in any such court has been brought
in an inconvenient forum.

SECTION 17. GENERAL PROVISIONS. This Agreement constitutes the entire
agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may be executed in two
or more counterparts, each one of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement may not be amended or modified unless in writing by all of the
parties hereto, and no condition herein (express or implied) may be waived
unless waived in writing by each party whom the condition is meant to benefit.
The Table of Contents and the Section headings herein are for the convenience of
the parties only and shall not affect the construction or interpretation of this
Agreement.

Each of the parties hereto acknowledges that it is a sophisticated
business person who was adequately represented by counsel during negotiations
regarding the provisions hereof, including, without limitation, the
indemnification provisions of Section 8 and the contribution provisions of
Section 9, and is fully informed regarding said provisions. Each of the parties
hereto further acknowledges that the provisions of Sections 8 and 9 hereto
fairly allocate the risks in light of the ability of the parties to investigate
the Company, its affairs and its business in order to assure that adequate
disclosure has been made in the Registration Statement, any preliminary
prospectus and the Prospectus (and any amendments and supplements thereto), as
required by the Securities Act and the Exchange Act.

If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company the enclosed copies hereof,
whereupon this instrument, along with all counterparts hereof, shall become a
binding agreement in accordance with its terms.

Very truly yours,

PROVANT, INC.

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<PAGE> 33
By:________________________________________
[Title]

The foregoing Underwriting Agreement is hereby confirmed and accepted
by the Representatives in San Francisco, California as of the date first above
written.

NATIONSBANC MONTGOMERY SECURITIES, LLC
SALOMON SMITH BARNEY INC.
PIPER JAFFRAY INC.

Acting as Representatives of the several Underwriters named in the attached
Schedule A.

BY NATIONSBANC MONTGOMERY SECURITIES, LLC

By:______________________________
<PAGE> 34
The undersigned joins this Agreement solely for the purposes of
Sections 8, 9, 11 and 12 of the Agreement.

BTI ACQUISITION CORP..

By:________________________________________

DECKER ACQUISITION CORP.

By:________________________________________

HOWARD ACQUISITION CORP.

By:________________________________________

LSS ACQUISITION CORP.

By:________________________________________

MOHR ACQUISITION CORP.

By:________________________________________

NOVATIONS ACQUISITION CORP.

By:________________________________________

STAR ACQUISITION CORP.

By:________________________________________

<PAGE> 35
[Signatures of Inside Founders]

By:________________________________________
[Title]

By:________________________________________
[Title]
<PAGE> 36
SCHEDULE A

NUMBER OF FIRM
UNDERWRITERS COMMON SHARES
TO BE PURCHASED

Nationsbanc Montgomery Securities, LLC.......................................
Piper Jaffray Inc............................................................
Salomon Smith Barney Inc.....................................................

Total..............................................................
<PAGE> 37
SCHEDULE B

[List of Founders]
<PAGE> 38
EXHIBIT A

Opinion of counsel for the Company to be delivered pursuant to
Section 5(e) of the Underwriting Agreement.

References to the Prospectus in this Exhibit A include any
supplements thereto at the Closing Date.

(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware.

(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectus and to enter into and perform its
obligations under the Underwriting Agreement. The Company and each of
its subsidiaries have all necessary authorizations, approvals,
consents, licenses, certificates and permits of and from all Federal
and state governmental or regulatory bodies or officials, to conduct
all the activities conducted by them, to own or lease all the assets
owned or leased by them and to conduct their businesses, all as
described in the Registration Statement and the Prospectus, and no such
authorization, approval, consent, order, license, certificate or permit
contains a materially burdensome restriction other than as disclosed in
the Registration Statement and the Prospectus.

(iii) The Company is duly qualified as a foreign corporation
to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except for
such jurisdictions where the failure to so qualify or to be in good
standing would not, individually or in the aggregate, result in a
Material Adverse Change.

(iv) Each subsidiary listed in Exhibit 21 to the Registration
Statement (a "Subsidiary") has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and, to the knowledge of such counsel, is
duly qualified as a foreign corporation to transact business and is in
good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except for such jurisdictions where the
failure to so qualify or to be in good standing would not, individually
or in the aggregate, result in a Material Adverse Change.

(v) All of the issued and outstanding capital stock of each
Subsidiary has been duly authorized and validly issued, is fully paid
and non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,

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<PAGE> 39
pledge, lien, encumbrance or, to the best knowledge of such counsel,
any pending or threatened claim.

(vi) The authorized, issued and outstanding capital stock of
the Company (including the Common Stock) conforms to the descriptions
thereof set forth in the Prospectus. All of the outstanding shares of
Common Stock have been duly authorized and validly issued, are fully
paid and nonassessable and, to the best of such counsel's knowledge,
have been issued in compliance with the registration and qualification
requirements of federal and state securities laws. The form of
certificate used to evidence the Common Stock complies with all
applicable requirements of the charter and by-laws of the Company and
the General Corporation Law of the State of Delaware.

(vii) No stockholder of the Company or any other person has
any preemptive right, right of first refusal or other similar right to
subscribe for or purchase securities of the Company arising (a) by
operation of the charter or bylaws of the Company or the General
Corporation Law of the State of Delaware or (b) to the best knowledge
of such counsel, otherwise.

(viii) The Underwriting Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the
Company, enforceable in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting creditors' rights generally or by general equitable
principles and except that counsel need express no opinion on the
enforceability of Sections 8 and 9 of the Underwriting Agreement.

(ix) The Common Shares to be purchased by the Underwriters
from the Company have been duly authorized for issuance and sale
pursuant to the Underwriting Agreement and, when issued and delivered
by the Company pursuant to the Underwriting Agreement against payment
of the consideration set forth therein, will be validly issued, fully
paid and nonassessable. The shares of Common Stock to be issued in
connection with the Founding Company Combinations have been duly
authorized for issuance and, when issued and delivered by the Company
in connection with the Founding Company Combinations, will be validly
issued, fully paid and nonassessable.

(x) Each of the Registration Statement and the Rule 462(b)
Registration Statement, if any, has been declared effective by the
Commission under the Securities Act. To the knowledge of such counsel,
no stop order suspending the effectiveness of either of the
Registration Statement or the Rule 462(b) Registration Statement, if
any, has been issued under the Securities Act and no proceedings for
such purpose have been instituted or are pending or are contemplated or
threatened by the Commission. Any required filing of the Prospectus and
any supplement thereto pursuant to Rule 424(b) under the Securities Act
has been made in the manner and within the time period required by such
Rule 424(b).

A-2
<PAGE> 40
(xi) The Registration Statement, including any Rule 462(b)
Registration Statement, the Prospectus and each amendment or supplement
to the Registration Statement and the Prospectus, as of their
respective effective or issue dates (other than the financial
statements and supporting schedules included therein or in, exhibits to
or excluded from the Registration Statement, as to which no opinion
need be rendered) appear on their fact to comply as to form with the
applicable requirements of the Securities Act.

(xii) The Common Shares have been approved for listing on the
New York Stock Exchange.

(xiii) The statements (a) in the Prospectus under the captions
"Risk Factors--Anti- Takeover Effect of Certain Charter Provisions,"
"Description of Capital Stock," and "Shares Eligible for Future Sale"
and (b) in Item 14 and Item 15 of the Registration Statement, insofar
as such statements constitute matters of law or legal conclusions or
summaries of documents referred to therein have been reviewed by such
counsel and fairly summarize, in all material respects, the matters
referred to therein.

(xiv) To the knowledge of such counsel, there are no legal or
governmental actions, suits or proceedings pending or threatened which
are required to be disclosed in the Registration Statement, other than
those disclosed therein.

(xv) To the knowledge of such counsel, there are no Existing
Instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described
or referred to therein or filed or incorporated by reference as
exhibits thereto; and all such Existing Instruments are fairly
summarized or disclosed in the Registration Statement.

(xvi) No consent, approval, authorization or other order of,
or registration or filing with, any court or other governmental
authority or agency, is required for the Company's execution, delivery
and performance of the Underwriting Agreement and of each Combination
Agreement and consummation of the transactions contemplated thereby and
by the Prospectus, except as required under the Securities Act,
applicable state securities or blue sky laws and from the NASD.

(xvii) The execution and delivery of the Underwriting
Agreement and of each Combination Agreement by the Company and the
performance by the Company of its obligations thereunder (other than
performance by the Company of its obligations under the indemnification
and contribution sections of the Underwriting Agreement, as to which no
opinion need be rendered) (a) have been duly authorized by all
necessary corporate action on the part of the Company; (b) will not
result in any violation of the provisions of the charter or by-laws of
the Company or any subsidiary; (c) will not constitute a breach of, or
Default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or, to
the knowledge of such counsel, any of its subsidiaries pursuant to, to
the best knowledge of such counsel, any other material Existing

A-3
<PAGE> 41
Instrument; or (d)to the best knowledge of such counsel, will not
result in any violation of any law, administrative regulation or
administrative or court decree applicable to the Company or any
subsidiary.

(xviii) The Company is not, and after receipt of payment for
the Common Shares will not be, an "investment company" within the
meaning of Investment Company Act.

(xix) Except as disclosed in the Prospectus under the caption
"Shares Eligible for Future Sale," to the knowledge of such counsel,
there are no persons with registration or other similar rights to have
any equity or debt securities registered for sale under the
Registration Statement or included in the offering contemplated by the
Underwriting Agreement, except for such rights as have been duly
waived.

(xx) Each of the Combination Agreements has been duly and
validly authorized, executed and delivered by the Company and is valid
and binding on the Company in accordance with its terms (subject to
customary exceptions). The Combinations pursuant to the Combination
Agreements have become effective. Such Combinations were consummated in
accordance with the provisions of the Combination Agreements and comply
in all material respects with applicable law.

In addition to the opinions set forth above, such counsel
shall state that they have participated in conferences with officers
and other representatives of the Company, representatives of the
independent public or certified public accountants for the Company and
with representatives of the Underwriters at which the contents of the
Registration Statement and the Prospectus, and any supplements or
amendments thereto, and related matters were discussed and, although
such counsel is not passing upon and does not assume any responsibility
for the accuracy, completeness or fairness of the statements contained
in the Registration Statement or the Prospectus (other than as
specified above), and any supplements or amendments thereto, on the
basis of the foregoing, nothing has come to their attention which would
lead them to believe that either the Registration Statement or any
amendments thereto, at the time the Registration Statement or such
amendments became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or
that the Prospectus, as of its date or at the First Closing Date or the
Second Closing Date, as the case may be, contained an untrue statement
of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading (it being understood that
such counsel need express no belief as to the financial statements or
schedules or other financial or accounting data derived therefrom,
included in the Registration Statement or the Prospectus or any
amendments or supplements thereto).

In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than the
General Corporation Law of the State of Delaware, the Commonwealth of
Massachusetts or the federal law of the United States, to the extent

A-4
<PAGE> 42
they deem proper and specified in such opinion, upon the opinion (which shall be
dated the First Closing Date or the Second Closing Date, as the case may be,
shall be satisfactory in form and substance to the Underwriters, shall expressly
state that the Underwriters may rely on such opinion as if it were addressed to
them and shall be furnished to the Representatives) of other counsel of good
standing whom they believe to be reliable and who are satisfactory to counsel
for the Underwriters; provided, however, that such counsel shall further state
that they believe that they and the Underwriters are justified in relying upon
such opinion of other counsel, and (B) as to matters of fact, to the extent they
deem proper, on certificates of responsible officers of the Company and public
officials.

A-5
<PAGE> 43
EXHIBIT B

_______________, 1998

NationsBanc Montgomery Securities, LLC
Salomon Smith Barney Inc.
Piper Jaffray Inc.
As Representatives of the Several Underwriters
c/o NationsBanc Montgomery Securities, LLC
600 Montgomery Street
San Francisco, California 94111

RE: Provant, Inc. (the "Company")

Ladies & Gentlemen:

The undersigned is an owner of record or beneficially of certain shares of
Common Stock of the Company ("Common Stock") or securities convertible into or
exchangeable or exercisable for Common Stock. The Company proposes to carry out
a public offering of Common Stock (the "Offering") for which you will act as the
representatives of the underwriters, The undersigned recognizes that the
Offering will be of benefit to the undersigned and will benefit the Company by,
among other things, raising additional capital for its operations. The
undersigned acknowledges that you and the other underwriters are relying on the
representations and agreements of the undersigned contained in this letter in
carrying out the Offering and in entering into underwriting arrangements with
the Company with respect to the Offering.

In consideration of the foregoing, the undersigned hereby agrees that the
undersigned will not, without the prior written consent of NMS (which consent
may be withheld in its sole discretion), directly or indirectly, sell, offer,
contract or grant any option to sell (including without limitation any short
sale), pledge, transfer, establish an open "put equivalent position" within the
meaning of Rule 16a-l(h) under the Securities Exchange Act of 1934, or otherwise
dispose of any shares of Common Stock, options or warrants to acquire shares of
Common Stock, or securities exchangeable or exercisable for or convertible into
shares of Common Stock currently or hereafter owned either of record or
beneficially (as defined in Rule 13d-3 under Securities Exchange Act of 1934, as
amended) by the undersigned, or publicly announce the undersigned's intention to
do any of the foregoing, for a period commencing on the date hereof and
continuing through the close of trading on the date one hundred eighty days
after the date of the Prospectus. The undersigned also agrees and consents to
the entry of stop transfer instructions with the Company's transfer agent and
registrar against the transfer of shares of Common Stock or securities
convertible into or exchangeable or exercisable for Common Stock held by the
undersigned except in compliance with the foregoing restrictions.

B-1
<PAGE> 44
With respect to the Offering only, the undersigned waives any registration
rights relating to registration under the Securities Act of any Common Stock
owned either of record or beneficially by the undersigned, including any rights
to receive notice of the Offering.

This agreement is irrevocable and will be binding on the undersigned and the
respective successors, heirs, personal representatives, and assigns of the
undersigned.

- ------------------------------
Printed Name of Holder

By:___________________________
Signature

- ------------------------------
Printed Name of Person Signing
(and indicate capacity of person signing
if signing as custodian, trustee, or on
behalf of an entity)

B-2

<PAGE> 1
EXHIBIT 21

SUBSIDIARIES OF THE REGISTRANT

Behavioral Acquisition Corp.
Decker Acquisition Corp.
Howard Acquisition Corp.
LSS Acquisition Corp.
MOHR Acquisition Corp.
Star Acquisition Corp.
Novations Acquisition Corp.

<PAGE> 1
EXHIBIT 23.1

Accountants' Consent

The Board of Directors
Provant, Inc.:

We consent to the use of our reports included herein and to the reference to
our firm under the heading "Experts" in the prospectus.

/s/ KPMG Peat Marwick LLP

Boston, Massachusetts
February 12, 1998

<PAGE> 1
EXHIBIT 23.2

Consent of Independent Accountants

The Board of Directors
Star Mountain, Inc.:

We consent to the reference to our firm under the heading "Experts" and to the
use of our report, dated December 5, 1997, on the financial statements of Star
Mountain, Inc. and subsidiaries as of December 31, 1995 and 1996, and June 30,
1997, and for each of the years in the three year period ended December 31,
1996, and for the six month period ended June 30, 1997, in the Registration
Statement on Form S-1 and the related Prospectus of Provant, Inc. for the
registration of its Common Stock.

Friedman & Fuller, P.C.

/s/ Friedman & Fuller, P.C.

Rockville, Maryland
February 12, 1998

<ARTICLE> 5
<MULTIPLIER> 1,000

<S> <C> <C>
<PERIOD-TYPE> YEAR 3-MOS
<FISCAL-YEAR-END> JUN-30-1997 JUN-30-1998
<PERIOD-START> NOV-16-1996 JUL-01-1998
<PERIOD-END> JUN-30-1997 SEP-30-1998
<CASH> 1 3
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 61 143
<PP&E> 150 153
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 211 349
<CURRENT-LIABILITIES> 298 560
<BONDS> 0 0
0 0
0 0
<COMMON> 2 3
<OTHER-SE> (89) (214)
<TOTAL-LIABILITY-AND-EQUITY> 211 349
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 149 200
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 8
<INCOME-PRETAX> (149) (208)
<INCOME-TAX> 60 83
<INCOME-CONTINUING> (89) (125)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (89) (125)
<EPS-PRIMARY> 0 0
<EPS-DILUTED> 0 0

</TABLE>

<PAGE> 1
EXHIBIT 99.1

If nominated or otherwise chosen to be a director of the Company, I hereby
consent to being named in the Company's Registration Statement on Form S-1 as an
individual who has agreed to serve in such capacity. If chosen to become an
officer of the Company, I hereby consent to act as such.

Signature /s/ Rajiv Bhatt
--------------------------
Dated: December 29, 1997

<PAGE> 1
EXHIBIT 99.2

Signature /s/ Herbert A. Cohen
--------------------------
Dated: December 20, 1997

<PAGE> 1
EXHIBIT 99.3

Signature /s/ Michael J. Davies
--------------------------
Dated: December 20, 1997

<PAGE> 1
EXHIBIT 99.4

Signature /s/ Bert Decker
--------------------------
Dated: December 19, 1997

<PAGE> 1
EXHIBIT 99.5

Signature /s/ Philip Gardner
--------------------------
Dated: February 10, 1998

<PAGE> 1
EXHIBIT 99.6

Signature /s/ Paul C. Green
--------------------------
Dated: December 22, 1997

<PAGE> 1
EXHIBIT 99.7

Signature /s/ Joe Hanson
--------------------------
Dated: February 5, 1998

<PAGE> 1
EXHIBIT 99.8

Signature /s/ John F. King
--------------------------
Dated: January 5, 1998

<PAGE> 1
EXHIBIT 99.9

Signature /s/ Dominic J. Puopolo
--------------------------
Dated: December 22, 1997

<PAGE> 1
EXHIBIT 99.10

Signature /s/ A. Carl von Sternberg
--------------------------
Dated: December 23, 1997

<PAGE> 1
EXHIBIT 99.11

Signature /s/ Paul M. Verrochi
--------------------------
Dated: December 22, 1997

<PAGE> 1
EXHIBIT 99.12

Signature /s/ Marc S. Wallace
--------------------------
Dated: December 31, 1997

<PAGE> 1
EXHIBIT 99.13

Signature /s/ John H. Zenger
--------------------------
Dated: December 28, 1997